The difference between real and nominal interest rates is
A. important because bonds are expressed in real rates.
B. the unemployment rate.
C. unimportant unless there is deflation.
D. the expected inflation rate.
D. the expected inflation rate.
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What is the pattern of exports and imports in China and India?
A) Exports are heavily subsidized through government policy. B) Many barriers to imports exist. C) Exports and imports are tied together, with exports depending on imported inputs and technology. D) Imports are not important to either nation's economy.
A bowed-outward production possibilities curve demonstrates the concept of
A) constant opportunity costs as production shifts from the production of one good to the production of the other good. B) decreasing opportunity costs as production shifts from the production of one good to the production of the other good. C) increasing opportunity costs as production shifts from the production of one good to the production of the other good. D) increasing opportunity costs at first but the opportunity costs steadily decrease as you move down along the curve.
Figure 11-2
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As we move down the production possibilities schedule in Figure 11-2, each successive point is
A. less efficient. B. more efficient. C. equally efficient. D. more or less efficient; we cannot tell which.
Critics of Fed independence argue that
a. monetary policy and fiscal policy are necessarily inconsistent. b. political control ensures low rates of inflation. c. monetary policy run by specialists is inherently inflationary. d. unelected officials are undemocratic.