Is it possible for inflation and recession to occur simultaneously in an economy?
A) No, because prices cannot rise during a recession.
B) No, because recession is caused by too little demand and inflation by too much demand.
C) Yes, and this has happened several times in the U.S. economy since World War II.
D) Yes, but it has not occurred since the Great Depression in the 1930s.
E) Yes, but while it is logically possible it has never actually happened in any major industrialized economy.
C
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Refer to the table below. If Tacos R Us sells its taco shells and taco sauce as a package, what is the profit-maximizing price for the bundle?
Tacos R Us sells two different types of products; taco shells and taco sauce. For simplicity, assume that the marginal cost of each product is $0, so that Tacos R Us' total revenue is also its total profit.
A) $7
B) $18
C) $10
D) $9
The opportunity cost of attending college is likely to include all except which of the following?
a. the cost of required textbooks b. tuition fees c. the income you forego in order to attend classes d. the cost of haircuts received during the school term
A higher reserve requirement
A. Further limits deposit creation. B. Increases the ability of banks to make loans. C. Increases the borrowing capability of borrowers. D. Lowers the interest rate.
In a full-employment economy, a rise in M will cause inflation unless:
A. V rises in proportion to the increase in M. B. the quantity of goods produced declines proportionately. C. tax reductions accompany the increase in the money supply. D. the velocity of money diminishes.