Demand-pull inflation is worse than cost-push inflation because, in addition to higher prices, demand-pull inflation also reduces employment
a. True
b. False
Indicate whether the statement is true or false
False
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A positive relationship exists between two variables if
A) one variable has "positively" no effect on the other variable. B) a reduction in one variable is associated with an increase in the other variable. C) a reduction in one variable is associated with a decrease in the other variable. D) both variables are inflation-distorted.
Lags in the approval and implementation of fiscal policy: a. weaken fiscal policy as a tool of economic stabilization
b. increase the effectiveness of fiscal policy as a tool of economic stabilization. c. help legislators better assess what policies are most appropriate to adopt. d. make fiscal policy more responsive to the current economic environment. e. cause fiscal policy to be more effective at changing the level of real GDP than changing the price level only in the long run.
An important problem with corporations is
A. the possibility of large liabilities for the owners. B. the separation of ownership and control. C. the inability of the government to control and tax the firms. D. the difficulties with raising financial capital.
The success of Fed intervention depends in part on how closely changes in long-term interest rates follow changes in short-term interest rates.
Answer the following statement true (T) or false (F)