The value by which the nominal GDP of an economy exceeds its real GDP in percentage terms is equal to the:
a. rate of inflation in the economy.
b. rate of deflation in the economy.
c. GDP deflator of the economy
d. GDP inflator of the economy.
c
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting downward C. Aggregate demand shifting rightward D. Aggregate demand shifting leftward
In the two-country model of the Monetary Approach, the spot exchange rate is determined by
A) the relative quantities of money supplied and demanded. B) the real money stock in country A vs. country B. C) the nominal incomes in the two countries. D) the ratio of prices in the economies.
The type of economic indicator that can best be used for business forecasting is the:
a. leading indicator b. coincident indicator c. lagging indicator d. current business inventory indicator e. optimism/pessimism indicator
OPEC's incentives to produce a stream of long-term profits for its member nations means that oil stocks will
A) probably last quite a while. B) most likely run out quickly. C) not be used or needed in the near future. D) increase indefinitely.