According to the rational expectations school, when the economy is operating at the potential output level, a temporary decrease in unemployment is possible through appropriate monetary policy—but only if workers and employers are aware in advance of the Fed's intentions
a. True
b. False
Indicate whether the statement is true or false
False
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What must occur for a good to violate the Law of Demand?
A. The good must be normal and the income effect must be larger than the substitution effect. B. The good must be normal and the substitution effect must be larger than the income effect. C. The good must be inferior and the income effect must be larger than the substitution effect. D. The good must be inferior and the substitution effect must be larger than the income effect.
For a perfectly competitive firm, price always equals marginal cost.
Answer the following statement true (T) or false (F)
Suppose in Belgium, the opportunity cost of producing a trombone is 8 clarinets. In Denmark, the opportunity cost of producing a trombone is 6 clarinets
a. What is the opportunity cost of producing a clarinet for Belgium? b. What is the opportunity cost of producing a clarinet for Denmark? c. Which country has a comparative advantage in the production of clarinets? d. Which country has a comparative advantage in the production of trombones?
Money values indexed to a given period are known as
A. nominal. B. real. C. inverse. D. random.