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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During the Christmas shopping season, the demand for money increases significantly. To offset the increase in money demand, the Fed must ________ the money supply, which will put ________ pressure on nominal interest rates.
A. decrease; upward B. decrease; downward C. increase; downward D. increase; upward
When there is an increase in the wages the banking industry offers accountants, what happens to the supply of accountants available to other industries?
A) The supply to other industries increases. B) The supply to other industries falls. C) The supply curve for other industries shifts to the right. D) no change
Refer to the information. The data suggest that:
Answer the question below on the basis of the following information for a private closed economy:
A. the interest rate and the equilibrium GDP are directly related.
B. the interest rate and the equilibrium GDP are inversely related.
C. the interest rate and the equilibrium GDP are unrelated.
D. as the interest rate falls, investment also falls.
The federal funds rate is the interest rate that:
A. the Fed charges to banks that borrow from it. B. banks charge the Fed for using their reserves. C. the Fed pays on bank reserves. D. banks charge each other for borrowed money.