Under the rational expectations hypothesis, which of the following is the most likely short-run effect of a move to expansionary monetary policy?
a. a higher general level of prices but little or no change in real output
b. a higher general level of prices and an expansion in real output
c. no change in the general level of prices and a reduction in real output
d. no change in either the general level of prices or real output
A
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Refer to Table 2-11. What is South Korea's opportunity cost of producing one pound of wheat?
A) 60 digital cameras B) 20 digital cameras C) 5 digital cameras D) 0.05 units of a digital camera
Everything else held constant, when output is ________ the natural rate level, wages will begin to ________, decreasing short-run aggregate supply
A) above; fall B) above; rise C) below; fall D) below; rise
If the commercial is TRUE that every additional bite of food tastes as good as the first, the marginal utility from consuming more of the advertised product must be
A. decreasing. B. constant. C. zero. D. increasing.
Other things constant, when household "time preferences" ________, business investment tends to ________
A) fall; fall B) fall; rise C) rise; fall D) rise; rise