Answer the question on the basis of the following information: year nominal GDP price index 1 550 140 2 560 135 3 576 125 4 586 117 5 604 108 In the economy above:
a) the price level is rising faster than nominal GDP.
b) nominal and real GDP are growing at the same rate.
c) the growth of nominal GDP understates the growth of real GDP.
d) the growth of nominal GDP overstates the growth of real GDP.
c) the growth of nominal GDP understates the growth of real GDP.
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An indirect tax is a tax paid by consumers
A) to a state or local government. B) when they purchase goods and services. C) on unearned income (as opposed to wages and salaries). D) that is a percentage of the value of their real property.
Which of the following is true regarding the required reserve ratio?
A) The ratio determines the legally required amount of reserves a bank must hold. B) The ratio determines the amount of excess reserves a bank must hold. C) The ratio is only enforced against banks that are operating in a risky manner. D) None of the above answers is correct.
An increase in the inflation rate shifts the labor
A) supply curve to the right. B) supply curve to the left. C) demand curve to the right. D) demand curve to the left.
Best guesses of an event occurring in the future are based on
A) estimates derived from the frequency of the event occurring in the past. B) coin flips. C) subjective probability. D) the wisdom of crowds.