It is generally agreed that when the rate of monetary growth exceeds the rate of growth in real GDP in the long run
A. the inflation rate will increase every year by a constant rate.
B. real GDP will grow at a faster rate.
C. the average price level will tend to decrease over time.
D. the average price level will tend to increase over time.
D. the average price level will tend to increase over time.
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To ask "what causes a recession" is the same as asking
A) "why does supply meet demand?" B) "what is the link between price elasticity of demand and price elasticity of supply?" C) "why have so many individuals made errors all at once?" D) "why have price controls failed us?"
In much of Europe, the legal age to obtain a driver's license is 18. If the legal driving age in the United States was changed to 18, how would this affect the market for new automobiles? The market for automobile insurance?
What will be an ideal response?
An increase in the real risk-free interest rate causes the:
a. Preferred asset ratio for currency in circulation (C/D) to fall, which decreases the quantity of real loanable funds supplied. b. Preferred asset ratio for customary reserves (U/D) to fall, which increases the quantity of real loanable funds supplied. c. Preferred asset ratio for near money (N/D) to fall, which decreases the quantity of real loanable funds supplied. e. None of the above.
In equilibrium with an Edgeworth production box
A. one is on the contract curve. B. the production of one good could increase without decreasing the production of the other. C. MPK/MPL = PL/PK. D. MPK * MPL = PL * PK. E. All of these are true