An industry experiencing increasing returns to scale and fixed factor prices will have a long-run supply curve that is:
A. upward sloping.
B. vertical.
C. horizontal.
D. downward sloping.
Answer: D
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The nominal interest rate parity condition states that
A) domestic and foreign assets must have nominal returns that are identical, irrespective of the characteristics of the assets. B) when domestic and foreign assets have identical risk, liquidity, and information characteristics, their nominal returns must also be identical. C) while nominal returns are equalized across all foreign and domestic assets, real returns may vary widely. D) while real returns are equalized across all foreign and domestic assets, nominal returns may vary widely.
The value added at all stages of production sums to the market value of the final good, and the value added for all final goods sums to GDP based on the income approach
a. True b. False Indicate whether the statement is true or false
For a given increase in aggregate demand, the steeper the short-run aggregate supply curve: a. the larger the increase in investment expenditure. b. the smaller the increase in the price level
c. the smaller the increase in real GDP. d. the larger the increase in real GDP. e. the smaller the increase in real interest rate.
Inflation
What will be an ideal response?