In which of the following cases was the inflation rate 12 percent over the last year?
a. One year ago the price index had a value of 110 and now it has a value of 120.
b. One year ago the price index had a value of 120 and now it has a value of 132.
c. One year ago the price index had a value of 134 and now it has a value of 150.
d. One year ago the price index had a value of 145 and now it has a value of 163.
c
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Refer to Figure 2-6. If the economy is currently producing at point D, what is the opportunity cost of moving to point B?
A) 8 thousand wrenches B) 30 thousand wrenches C) 23 thousand hammers D) 0 hammers
If the price level does not fall or only falls very slowly, then the result will be a prolonged period of
a. inflation whenever supply increases. b. production below potential GDP. c. production above potential GDP. d. rapid price increases when demand changes.
Suppose a market is initially competitive with many firms selling an identical product. Over time, however, suppose the merging of firms results in the market being served by only three or four firms selling this same product. As a result, we would expect
a. an increase in market output and an increase in the price of the product. b. an increase in market output and an decrease in the price of the product. c. a decrease in market output and an increase in the price of the product. d. a decrease in market output and a decrease in the price of the product.
Not-for-profit organizations are often harder to run than for-profit firms.
a. true b. false