Discuss the current debate on the optimal inflation target
What will be an ideal response?
At this stage, most central banks in richer countries have an inflation target of about 2%. They are being challenged on two fronts. Some economists want to achieve price stability — that is, 0% inflation. Others want, instead, a higher target rate of inflation, say 4%, to help prevent from falling in the liquidity trap in the future.
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Which one of the following does NOT appear to contribute to economic growth?
A) knowledge B) a system of well-defined property rights C) protectionism D) innovation
According to the Application, the market price of meteorites varies from a few dollars per gram to hundreds of dollars per gram. In a market system like the market for meteorites, prices vary due to
A) government intervention in the pricing of the products. B) outsourcing. C) the lack of accounting rules in this market. D) the relative scarcity, or rarity, of the product.
The table below shows data for the U.S
Nominal Interest Rate Inflation Rate 2013 5.25 4 2014 5 2 2015 4.5 4.3 Between 2014 and 2015 the real interest rate ________ and caused a ________ the demand for loanable funds curve. A) increased; rightward shift B) decreased; movement down along C) increased; movement up along D) decreased; leftward shift
People tend to remain in those occupations that require continuous time and financial commitments to remain productive
a. True b. False Indicate whether the statement is true or false