The relationship between money supply, output, and the overall level of prices is illustrated by the:
A. classical theory of inflation.
B. neutrality of money.
C. aggregate price level.
D. measure of real output.
A. classical theory of inflation.
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When a production possibilities frontier is bowed outward, the opportunity cost of the second good in terms of the first good increases as more of the second good is produced
a. True b. False Indicate whether the statement is true or false
The secondary effects of an economic action refer to the
What will be an ideal response?
When two countries specialize and trade:
A. they can have consumption possibilities beyond their production possibilities. B. surplus can be gained by both countries. C. both can enjoy more output than either could produce on its own. D. All of these are true.
At the beginning of the year, one developing country (DVC) has a real income per capita of $800. In a developed country (IAC), the real income per capita is $30,000. Both countries experience a 4 percent growth rate for the year. At the end of the year, the absolute income gap between these two countries will have increased from $29,200 to:
A. $30,368 B. $31,200 C. $30,120 D. $32,032