When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand
B. increase; raise; decline
C. decline; lower; decline
D. decline; raise; decline
Answer: B
You might also like to view...
If a price ceiling of $5 per gallon is imposed on gasoline, and the market equilibrium price is $4.50, then the price ceiling is a binding constraint on the market
a. True b. False Indicate whether the statement is true or false
When diamonds are mined in conflict or war-torn areas, there is:
A. Minimal profit or loss B. Minimal waste of this resource C. Strong incentive for conservation D. Strong incentive for over-mining
Social surplus is:
A) the product of consumer surplus and producer surplus. B) the consumer surplus minus producer surplus. C) the ratio of consumer surplus to producer surplus. D) the sum of consumer surplus and producer surplus.
Which of these statements best describes a flow variable?
a. An economic variable that measures something at a particular point in time b. An economic variable whose value is determined by the market c. An economic variable that is measured per unit of time d. An economic variable whose value shows no change over time e. An economic variable that remains static when other related variables change