New classical economists believe that there is
A) a short-run tradeoff between inflation and unemployment when policy is unanticipated.
B) a short-run tradeoff between inflation and unemployment when policy is correctly anticipated.
C) no short-run tradeoff between inflation and unemployment when policy is correctly anticipated.
D) a and b
E) a and c
E
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The owner of a pizza shop observes that when she raises the price of a large pizza, her total revenue decreases, and when she lowers the price of a large pizza, her total revenue increases. This suggests that:
A. pizza lovers act irrationally. B. the demand for her large pizzas is inelastic with respect to price. C. the demand for her large pizzas is elastic with respect to price. D. there are few good substitutes for a large pizza.
Movements away from equilibrium in the Solow model:
A) persist and cannot be corrected. B) are corrected only through government intervention. C) are automatically corrected. D) are corrected only when the country opens up to international trade.
Assume that any given percentage of the population earns an equal percentage of real GDP. This percentage of population will be represented by:
a. a point below the line of income equality. b. a line lying below the line of income equality. c. a point on the line of income equality. d. a line lying above the line of income equality. e. a point above the line of income equality.
If the interest rate is 8 percent, then the present value of $1,000 to be received in 4 years is $735.03
a. True b. False Indicate whether the statement is true or false