The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier.
B. self-correcting property.
C. short-run equilibrium property.
D. long-run equilibrium property.
Answer: B
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Explain how Brazil was able to reduce the rate of inflation from 2,669 percent in 1994 to less than 10 percent in 1997?
What will be an ideal response?
A positive network externality associated with a good:
A. is not associated with the value of a good in any way. B. yields more intrinsic value than without it. C. yields more extrinsic value but less intrinsic value from its consumption. D. results in less intrinsic or extrinsic value.
Opportunity cost is:
A) the costs of all sacrifices not chosen when a choice is made. B) the highest valued other choice that could have been made. C) the result of having made a bad choice. D) the result of not making choices at the margin.
Which of the following purchases is included in the calculation of gross domestic product?
a) a used economics textbook from the bookstore b) new harvesting equipment for the farm c) 1,000 shares of stock in a computer firm d) a car produced in a foreign country e) government bonds issued by a foreign firm