The International Fisher Effect implies that the country with the higher interest rate should have lower inflation.
a. true
b. false
b. false
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The self-correcting tendency of the economy means that falling inflation eventually eliminates:
A. exogenous spending. B. recessionary gaps. C. expansionary gaps. D. unemployment.
Based on the simple spending multiplier, which of the following will increase real GDP?
a. Decreased government spending b. Increased business taxes c. Increased investment spending d. Decreased consumption spending
A decrease in income will lead to an increase in the demand for an inferior good.
Answer the following statement true (T) or false (F)
"Macroeconomics is the part of economics concerned with individual units such as a person, a household, a firm, or an industry." This statement is:
A. positive but incorrect. B. positive and correct. C. normative but incorrect. D. normative and correct.