Inflation can come from the demand side or from the supply side of the economy
a. True
b. False
Indicate whether the statement is true or false
True
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Generally, ________ motivates firms to enter an industry, while ________ motivates firms to exit an industry.
A. accounting profit; accounting loss B. economic profit; economic loss C. economic profit; accounting loss D. accounting profit; economic loss
Most economists believe that biases cause changes in the CPI to overstate the inflation rate by ________ percentage points
A) 0.1 to 0.2 B) 0.2 to 2.0 C) 0.4 D) 0.5 to 1.0 E) 1.0 to 3.0
By internal balance, most economists mean
A) full employment. B) price stability. C) full employment and price stability. D) full employment and moderate increase in prices. E) full employment and high disposable income.
Natural disasters like severe earthquakes are devastating to the economy as well as to the individuals harmed due to
A) supply shocks. B) demand shocks. C) demand-pull inflation. D) demand-pull deflation.