Starting from potential output, if consumer confidence decreases and consumers decide to spend less, then this will generate a(n) ________ gap and inflation will ________.
A. recessionary; increase
B. expansionary; increase
C. expansionary; decrease
D. recessionary; decrease
Answer: D
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A good is path dependent when
A) it can only be used in one way. B) people who move location follow the path of people who moved before them. C) consumers get utility from consuming goods that others are consuming, such as restaurants. D) the first technology that was adopted has an advantage over a better technology that came later.
__________ is the number of units that individuals are __________ to buy at a particular price during some time period
A) Demand; willing and able B) Supply; willing and able C) Quantity demanded; willing and able D) Demand; able E) Quantity demanded; willing
If the CPI was 102.4 in Year 1 and was 105.7 for Year 2, then the rate of inflation between Year 1 and Year 2 was:
(a) 2.2%. (b) 3.2%. (c) 4.2%. (d) We need more information to calculate it.
Increased deficit financing, following the use of expansionary fiscal policy by the U.S., will raise U.S. interest rates and causes the dollar to appreciate
Indicate whether the statement is true or false