According to the misperceptions theory, an anticipated 10% decrease in the money supply leads to a short-run reduction in the price level of
A. some amount between 0% and 10%.
B. 5%.
C. 10%.
D. 0%.
Answer: C
You might also like to view...
Where can equilibrium GDP be found on a graph?
a. Where the consumption function crosses the 45-degree line b. Where the 45-degree line crosses the investment function c. Where the aggregate expenditure function crosses the 45-degree line d. Where total output is equal to the unplanned inventory change e. Where the next exports function crosses the 45-degree line
The United States is capable of producing many goods and services that it imports, but it does not because
A. We have lost those skilled workers. B. We can export goods that we specialize in. C. We produce those goods more cheaply if we make them ourselves. D. We can import those goods at a lower opportunity cost than if we make them ourselves.
Briefly explain Schumpeter’s model of innovation. Why does an innovator’s economic profit eventually reduce to zero?
What will be an ideal response?
If a U.S. firm produces cars in Mexico, that production should count towards
A) U.S. GNP. B) Mexico's GNP. C) U.S. GDP. D) It will not affect either U.S. GNP or U.S. GDP.