The classicals assumed ________ wages and _________ prices.
Fill in the blank(s) with the appropriate word(s).
flexible (downward); flexible (downward)
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Assuming the same sized substitution effect, normal goods have steeper cross-price demand curves than inferior goods.
Answer the following statement true (T) or false (F)
From 1800-1860 which part of the nation was most opposed to high tariffs?
a. South. b. New England. c. Middle Atlantic States. d. Far Western States.
When the government bans a good it:
A. creates a more efficient solution than any other to the nonexcludability problem. B. is an easy, but often ineffective, solution to the nonexcludability problem. C. increases surplus more than any other solution to the nonexcludability problem. D. is the easiest and most effective solution to the nonexcludability problem.
Adjusting monetary growth based on previous changes in nominal GDP
A) is relatively easy for the Fed to undertake because the implementation lag is quitelong. B) could be destabilizing because of the uncertainty of the length of impact lags. C) is an effective policy because it allows the Fed to influence future macroeconomic performance. D) raises the price level proportionately.