If actual inflation is greater than expected inflation,
A) the unemployment rate rises. B) the Phillips curve is a vertical line.
C) real wages fall. D) real wages rise.
C
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If the Federal Reserve lowers the Federal funds rate,
A) the price level falls. B) net exports decrease. C) other short-term interest rates rise. D) other short-term interest rates fall. E) Both answers A and C are correct.
Catherine compares the prices of candy bars in order to get the "best buy." This comparison represents using money as a
A) medium of exchange. B) store of value. C) unit of account. D) none of the above.
If a production possibilities frontier is bowed out (concave to the origin), then production occurs under conditions of
A) constant opportunity costs. B) increasing opportunity costs. C) decreasing opportunity costs. D) infinite opportunity costs. E) uncertain opportunity costs.
Josh wants to go to the football game this weekend, but he has a paper due on Monday. It will take him the whole weekend to write the paper. Josh decides to stay home and work on the paper. According to the Scarcity Principle, the reason Josh doesn't go to the game is that:
A. writing the paper is easier than going to the game. B. Josh prefers schoolwork to football games. C. Josh can't go the game and finish the paper. D. going to the game won't be fun.