Stagflation refers to a situation in which the economy is experiencing:
A. high economic growth and high inflation.
B. low economic growth and high inflation.
C. high economic growth and low inflation.
D. low economic growth and low inflation.
Answer: B
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting downward C. Aggregate demand shifting rightward D. Aggregate demand shifting leftward
Refer to the table above. Maximum social surplus is:
A) $10. B) $12. C) $14. D) $16.
A new area of economics studies situations in which people appear to be making choices that do not appear to be economically rational. This area is called
A) irrational economics. B) social economics. C) behavioral economics. D) new wave economics.
Figure 7-12
Refer to . When price falls from $50 to $40, it can be inferred that demand between those two prices is
a.
inelastic, since total revenue decreases from $8,000 to $5,000.
b.
inelastic, since total revenue increases from $5,000 to $8,000.
c.
elastic, since total revenue increases from $5,000 to $8,000.
d.
unit elastic, since total revenue increases from $5,000 to $8,000.