An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase
B. increase; increase
C. decrease; decrease
D. increase; decrease
Answer: D
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When a tax is imposed on buyers, consumer surplus decreases but producer surplus increases
a. True b. False Indicate whether the statement is true or false
The present discounted value of $100 to be received one year from now, if the interest rate is 2.5 percent, is closest to
A. $98. B. $95. C. $103. D. $100.
In a market that is characterized by imperfect competition,
a. firms are price takers. b. there are always a large number of firms. c. there are at least a few firms that compete with one another. d. the actions of one firm in the market never have any impact on the other firms' profits.
Economics is the study of:
A. how to invest in the stock market. B. how society uses limited resources. C. the role of money in markets. D. how government officials decide which goods and services are produced.