Too much spending chasing too few goods is the essence of what type of inflation?
What will be an ideal response?
demand-pull inflation
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Which of the following is likely to cause a decrease in the natural rate of unemployment?
A) an increase in the percentage of the working-age population receiving disability insurance B) a decrease in the use of temporary workers C) a growing percentage of young workers in the labor force D) generous unemployment insurance benefits
If Janet Yellen, Chair of the Federal Reserve Board, begins to tighten monetary policy by raising US interest rates next year, what is the likely impact on the value of the dollar?
a. The value of the dollar falls when US interest rates rise. b. The value of the dollar rises when US interest rates rise. c. The value of the dollar is not related to US interest rates. d. This is known as Purchasing Power Parity or PPP. e. The Federal Reserve has no impact at all on interest rates.
From 1991 to 2007, the rate of inflation in the U.S. has been
a. zero. b. between zero and 2.1%. c. between 1.6% and 4.1%. d. between 3.2% and 7.2%.
Economic efficiency requires that
a. individuals produce at their maximum level. b. only long-lasting, high-quality products be produced without regard to cost. c. income be distributed equally among consumers. d. all economic activity generating more benefits than costs be undertaken.