The inflation rate is the annual percentage change in the average price level.
Answer the following statement true (T) or false (F)
True
See the definition of the inflation rate.
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The demand for money is ________ related to the nominal interest rate
A) positively B) negatively C) not D) None of the above answers is correct because the relationship between the demand for money and the nominal interest rate changes with the inflation rate.
Grace Makutsi finally bought a pair of blue shoes that she had been coveting for a long time. In less than a week she discovered that the shoes were uncomfortable. Grace went back to wearing her old pair and stashed away the new pair
When asked by her boss, Mme. Ramotswe, why does she not simply give away the new pair, she said: "But I paid so much for them." Grace's behavior A) supports the endowment effect which states that ownership of an item makes it more valuable. B) is rational because the more you pay for an item the more valuable it is. C) ignores the fact that the purchase price is now a sunk cost and has no bearing on whether she should give them away or not. D) is rational: she should not discard a valuable item.
You turn to the bond market page of a newspaper and look under the column headed "Bonds" and see that it says, "Alpha 7 1/2 25" this information indicates that
A. the coupon rate on this bond is 7.5 percent. B. the year this bond matures is 2025. C. the current yield on this bond is 7.5 percent. D. the current yield on this bond has risen 0.25 percent since the previous trading day. E. a and b
A theory is a(n)
a. answer to a problem. b. way to explain the result an economist wants. c. tool to help determine the answer to a problem. d. a graph.