If the percent change in real GDP is 5 percent and inflation rate is 1 percent, what is the percent change in nominal GDP?
A. 2 percent.
B. 4 percent.
C. 0 percent.
D. 6 percent.
Answer: D
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Which of the following statements regarding the long-term equilibrium is TRUE?
A) As new firms enter a market, each existing firm increases the quantity it produces. B) Firms leave a market if they are making zero economic profit. C) Entry and exit stop when firms are making an economic profit. D) Entry and exit stop when firms make zero economic profit.
A GDP price chain price index number of 120.0 for a given year indicates that prices in that year are 20 percent higher than prices in the base year
a. True b. False Indicate whether the statement is true or false
The original goal of the Fed's founders was to prevent the
a. supply of money from increasing too rapidly. b. supply of money from decreasing during downturns. c. possibility of hyperinflation. d. possibility of interest rates falling too rapidly.
If price is below the equilibrium, then quantity supplied will be less than quantity demanded putting upward pressure on price.
Answer the following statement true (T) or false (F)