A vertical Phillips Curve is consistent with
A) a constant price level.
B) constant velocity.
C) an upward sloping aggregate supply curve.
D) a vertical aggregate supply curve.
D
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Moral hazard is a problem in providing deposit insurance because insured banks are
A) more likely to make bookkeeping errors. B) overly cautious due to extra regulations adopted by the FDIC. C) more likely to provide bank managers with lavish perquisites. D) encouraged to take on more risk.
The Fed would engage in ____ it wanted to address an inflationary gap
a. expansionary monetary policy b. contractionary monetary policy c. contractionary fiscal policy d. expansionary fiscal policy
As a result of an increase in the earnings gap between skilled and unskilled jobs, the incentive to get a college education has been declining
a. True b. False Indicate whether the statement is true or false
The inflation rate is calculated
a. by determining the change in the price index from the preceding period. b. by adding up the price increases of all goods and services. c. by computing a simple average of the price increases for all goods and services. d. by determining the percentage increase in the price index from the preceding period.