The present value of an asset generally:
A. is less than the future value.
B. has an ambiguous relationship with the future value.
C. equals the future value.
D. exceeds the future value.
Answer: A
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When the actual unemployment rate is greater than the NAIRU, the inflation rate
A) remains unchanged. B) tends to increase. C) falls to zero. D) tends to decrease.
If technological change is "labor augmenting," then
A) output per worker declines, output per unit of capital increases. B) "effective labor input" increases, output per unit of capital declines. C) output per worker increases, output per unit of capital is constant. D) Both output per worker and output per unit of capital change.
Inflation targeting is one policy that attempts to deal with the problem of:
a. dollarization. b. time inconsistency. c. the tradeoff between inflation and unemployment. d. the liquidity trap. e. none of the above.
There are two closely related crops, X and Y, with the following demand functions QX = 180 - 2PX + PY and QY = 150 + PX - PY where QX is the quantity of X, PX is the price of X, QY is the quantity of Y, and PY is the price of Y
These two crops are grown in two widely separated countries so there is no interrelationship between the supply curves. The short-run perfectly inelastic supply for X is 150 while the short-run perfectly inelastic supply for Y is 100. In equilibrium, the prices are A) PX = 80, PY = 130 B) PX = 40, PY = 65 C) PX = 60, PY = 120 D) PX = 30, PY = 80