Suppose most people had anticipated that inflation would be 3% in the coming year because the Fed would increase the money supply by 3%. Instead, the Fed increases the money supply by 5%. In the short run, this would cause actual output to be ________ full-employment output and prices to increase by ________ 3%.
A. above; more than
B. below; more than
C. below; less than
D. above; less than
Answer: A
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If the price of chewing gum is represented by P in equation P = 25 - 0.5 QD, then the corresponding quantity of chewing gum demanded is represented by the demand equation
A) QD = 2P - 0.5. B) QD = 0.5P + 25. C) QD = -5 + 10P. D) QD = 50 -2P.
An industrial union is a union composed of workers in the same skilled profession
a. True b. False
The patent and copyright systems
a. reduce the cost of duplicating intellectual property b. help make the market for intellectual property more competitive c. are forms of intellectual property d. help increase the incentives to create new intellectual property e. help reduce the incentives to create new intellectual property
Permanent price differentials among resources are explained by which of the following reasons?
a. movement from lower pay to higher pay b. movement from no benefits to higher benefits c. differences in the time and money involved in developing the necessary skills d. none of the above explain permanent price differentials in resources