If one tracks the prices of critical metals, one sees that
a. they have risen more slowly than the general rate of inflation.
b. they have risen about as rapidly as the general rate of inflation.
c. the prices indicate increasing scarcity of the metals.
d. the prices have fluctuated too wildly to conclude anything.
b
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Refer to Figure 10.8. Other things equal, an increase in expected inflation would best be represented by
A) a movement from point A to point C. B) a movement from point A to point D. C) a shift from LM1 to LM2. D) a shift from LM2 to LM1.
Assuming the Federal Reserve makes an open-market purchase of a government security worth $10,000 . By writing a check to pay for this security, the Federal Reserve
a. reduces the balance of its assets by $10,000. b. reduces the balance of its liabilities by $10,000. c. neither reduces the balance of its assets nor the balance of its liabilities by $10,000. d. creates a new $10,000 liability against itself. e. both c and d are correct.
If a firm is in a perfectly competitive world but decides to charge a higher price than its competitors,
A) the firm's profits will be zero or negative, and the firm will fail in the long run. B) the firm's profits will be zero or negative, and the firm will fail in the short run. C) the firm's profits will be positive or negative, and the firm will fail in the short run. D) the firm's profits will be positive or negative, and the firm will fail in the long run.
In economics, the concept of active government intervention in the macroeconomy was first emphasized by
A. supply-side economists. B. rational expectation theorists. C. monetarists. D. John Maynard Keynes.