The value of the CPI for the reference base period is always
What will be an ideal response?
100
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If a hurricane were to wipe out the majority of the eastern seaboard in the United States:
A. neither the short-run nor long-run aggregate supply curves would be affected. B. only the long-run aggregate supply curve would shift left. C. only the short-run aggregate supply curve would shift left. D. the long-run and short-run aggregate supply curves would both shift left.
A significant bank crisis in one Eurozone country is a problem for the ECB because:
A) it will violate its money supply growth rule if it tries to provide liquidity to that country's banks. B) it has no mandate to be a lender of last resort to financial institutions in the Eurozone. C) it has no ability to affect the money supply in Eurozone countries. D) its consensus decision-making process may prompt too rapid a reaction to a crisis in one country.
How does a decrease in value of a country's currency relative to other currencies affect its balance of trade?
A) A decrease in value of a country's currency relative to other currencies raises imports, reduces exports, and reduces the balance of trade. B) A decrease in value of a country's currency relative to other currencies reduces imports, raises exports, and reduces the balance of trade. C) A decrease in value of a country's currency relative to other currencies reduces imports, raises exports, and increases the balance of trade. D) A decrease in value of a country's currency relative to other currencies raises imports, reduces exports, and increases the balance of trade.
When monopolistically competitive firms earn ________ economic profits, other firms ________ an industry in the long run.
A. negative; enter B. zero; exit C. zero; enter D. positive; enter