A decrease in the inflation target by the central bank would:
A. cause the dynamic aggregate demand curve to shift to the right.
B. cause the dynamic aggregate demand curve to shift to the left.
C. have no impact on the positioning of the dynamic aggregate demand curve.
D. be reflected by a movement down and along the existing dynamic aggregate demand curve.
Answer: B
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Beginning in 1971, the Nixon administration enacted a series of price controls in hopes of reducing inflation. The first of these, known as Phase I,
a. consisted of a price freeze. b. imposed a ceiling price on meat, but left other prices unregulated. c. froze wages, but left other prices unregulated. d. applied only to oil prices.
A rapid, unexpected increase in the inflation rate could make real interest rates negative
a. True b. False Indicate whether the statement is true or false
The Hart-Scott-Rodino Act of 1980:
A. extended antitrust legislation to proprietorships and partnerships. B. made it legal to monopolize a market. C. outlawed asset-purchase mergers that would substantially reduce competition. D. outlawed price discrimination for the purpose of reducing competition.
Suppose that a worker in Country A can make either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can make either 18 bananas or 6 tomatoes each year. Country B has 400 workers. Two possible consumption bundles that Country A could produce are:
A. (5,000 bananas, 1,000 tomatoes) and (1,000 bananas, 5,000 tomatoes) B. (2,500 bananas, 500 tomatoes) and (1,250 bananas, 800 tomatoes) C. (5,000 bananas, 0 tomatoes) and (2,500 bananas, 500 tomatoes) D. (2,500 bananas, 750 tomatoes) and (1,250 bananas, 750 tomatoes)