The transmission mechanism in an economy alters:
a. nominal gross domestic product through changes in the interest rate.
b. real gross domestic product through changes in the interest rate
c. real gross domestic product through changes in the price level.
d. nominal gross domestic product through changes in the price level.
b
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The efficiency
A) gain from a fixed exchange rate with the euro is smaller when trade between say, Norway and the euro zone, is extensive than when it is small. B) gain from a fixed exchange rate with euro is greater when trade between say, Norway and the euro zone, is extensive than when it is small. C) loss from a fixed exchange rate with the euro is smaller when trade between say, Norway and the euro zone, is extensive than when it is small. D) gain from a fixed exchange rate with euro is the same as when trade between say, Norway and the euro zone, is extensive than when it is small. E) gain from a fixed exchange rate with euro is the same as when trade between say, Norway and the euro zone, is small than when it is small.
(Last Word) The "after this, therefore because of this" fallacy states that
What will be an ideal response?
During 1990, a Hershey candy bar cost $.85. By 2007, the same Hershey candy bar cost $1.25. If the CPI was 130.7 in 1990 and 180.5 in 2007, the price of the 1990 Hershey candy bar in 2007 prices is
A) greater than the price of the 2007 Hershey candy bar. B) less than the price of the 2007 Hershey candy bar. C) equivalent to the price of the 2007 Hershey candy bar. D) perhaps greater than, perhaps less, or perhaps the same depending on whether the CPI in 2007 has been adjusted to reflect 2007 prices. E) not able to be determined given the information in the question.
This chapter stressed the importance of using appropriate samples for empirical studies. Consider the following two problems in that light
a. You are given a class assignment to find out if people's political leanings affect the newspaper or magazine that they read. You survey two students taking a political science class and five people at a coffee shop. Almost all the people you have spoken to tell you that their political affiliations do not affect what they read. Based on the results of your study, you conclude that there is no relationship between political inclinations and the choice of a newspaper. Is this a valid conclusion? Why or why not? b. Your uncle tells you that the newspaper or magazine that people buy will depend on their age. He says that he believes this because, at home, his wife and his teenage kids read different papers. Do you think his conclusion is justified?