One fundamental idea in macroeconomics about inflation is:
A. if all wages rise, then inflation doesn't really affect anyone's purchasing power.
B. when all prices rise, inflation occurs and everyone is worse off.
C. keeping prices constant is the only way to ensure increasing purchasing power over time.
D. if all prices decline, the purchasing power of everyone declines.
A. if all wages rise, then inflation doesn't really affect anyone's purchasing power.
You might also like to view...
President Bigego is running for re-election against Senator Pander. Bigego proclaims that more people are working now than when he took office. Pander says that the unemployment rate is higher now than when Bigego took office. You conclude that
a. one of them must be lying. b. both of them could be telling the truth if the labor force, and employment grew at the same rate. c. both of them could be telling the truth if the labor force grew slower than employment. d. both of them could be telling the truth if the labor force grew faster than employment.
What should happen to the equilibrium price and quantity in a market as a result of a quota on imports?
A. Equilibrium price should go down, and equilibrium quantity should go up. B. Equilibrium price and quantity should both go up. C. Equilibrium price should go up, and equilibrium quantity should go down. D. Equilibrium price and quantity should both go down.
The MRP of labor will shift to the right if
A. wages decrease. B. labor productivity increases. C. labor productivity decreases. D. wages increase.
If there are external costs of production and firms do not have to account for these costs, then the firms will ________ and ________ compared with the efficient values.
A. overproduce; underprice B. underproduce; underprice C. underproduce; overprice D. overproduce; overprice