Unanticipated inflation is associated with cost increases which are not expected.
Answer the following statement true (T) or false (F)
True
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Refer to the figure below. If the Federal Reserve wants to lower the interest rate to 3%, it must ________ the money supply to ________. 
A. decrease; 300 B. increase; 900 C. increase; 700 D. increase; 300
Since 1972, the world price of oil has been largely determined by OPEC, which controls about 75 percent of the world's proven oil reserves. Since 1972 the price of oil has
A) fluctuated. OPEC's situation is an example of a prisoner's dilemma. B) risen slowly, but steadily. Members of OPEC fear that if they raise the price of oil too quickly this will lead oil-buying nations to accuse OPEC of price gouging, which is illegal under international law. C) been tied by OPEC to the rate of inflation in the United States. If, for example, the rate of inflation is 5 percent in one year, OPEC will raise the price of oil by 5 percent the next year. D) steadily fallen through the 1970s, then risen continually in the years since then. OPEC's actions are an example of implicit collusion.
One In The News article is titled "The Misery Index." If the inflation rate is 5 percent and the unemployment rate is 7 percent, the misery index is
A. 12 percent. B. 35 percent. C. 1.4 percent. D. 2 percent.
If output growth exceeds population growth for a country,
A. Average living standards will increase. B. This country must have overcome the problem of opportunity costs. C. Per capita GDP will decrease. D. GDP must have fallen at a very rapid rate.