Real income for a given year would be less than nominal income in that year if:
A. the consumer price index was less than 100 in that year.
B. nominal income in that year was greater than nominal income in the previous year.
C. nominal income in that year was less than nominal income in the previous year.
D. the consumer price index was greater than 100 in that year.
Answer: D
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When voluntary exchange takes place, only one party gains from the exchange
Indicate whether the statement is true or false
Milly Miser removes $250,000 from her mattress and opens a checking account. This single transaction immediately increases the money supply by
a. $250,000. b. $50,000. c. $0. d. ?$250,000.
The reason for the increase in inflation risk over time is due to the fact that:
A. the inflation rate always increases over time. B. we always have inflation. C. investors are more focused on nominal returns than real returns. D. it is more difficult to forecast inflation over longer periods of time.
Refer to Table 2-5. Assume Nadia's Neckware only produces ascots and bowties. A combination of 16 ascots and 6 bowties would appear
A) along Nadia's production possibilities frontier. B) inside Nadia's production possibilities frontier. C) outside Nadia's production possibilities frontier. D) at the horizontal intercept of Nadia's production possibilities frontier.