When the CPI increases from one year to the next:
A. the cost of living has decreased.
B. people need to spend more money to buy the same amount of goods as the previous year.
C. deflation has occurred.
D. All of these statements are true.
Answer: B
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Investment spending is countercyclical
Indicate whether the statement is true or false
Capital gains are the profit earned from the sale of
A) stocks. B) real estate. C) bonds. D) all of the above.
If Jet Cruises chooses to No Ad, Easy Sail should ________ and earn ________ million in net profit.
Jet Cruises wants to prevent Easy Sail from entering the sailboat market. The above game tree illustrates the different strategies and corresponding payoffs for the two firms. Both Jet Cruises and Easy Sail have the same strategies of advertising (Ad) or not advertising (No Ad). The payoffs represent net profit in millions.
A) Ad; $4 B) No Ad; $10 C) No Ad; $2 D) Ad; $10
Irregular fluctuations in economic activity are known as the
a. business cycle. b. broken window fallacy. c. tradeoff between inflation and unemployment. d. ten principles of economics.