When actual output exceeds potential output, there is ________ output gap and the inflation rate will ________.
A. an expansionary; be lower than the expected rate of inflation
B. no; be equal to the expected rate of inflation
C. an expansionary; exceed the expected rate of inflation
D. a recessionary; exceed the expected rate of inflation
Answer: C
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A) total benefit we receive from consuming a good or service. B) additional benefit we receive from consuming one more unit of a good or service. C) minimum amount of other goods or services we are willing to give u
In order to be binding, a price ceiling
A) must be high enough for firms to earn a profit. B) must coincide with the free market equilibrium price. C) must lie below the free market equilibrium price. D) must lie above the free market equilibrium price.
An economic service need not be
a. useful. b. scarce. c. transferable. d. tangible.
The referendum version of the median voter model allows voters to vote on a series of marginally increasing quantities of a good
a. True b. False