Confusion and inconvenience costs arise when inflation
a. improves the store of value function of money.
b. reduces the real value of the unit of account
c. introduces tax distortions on capital gains.
d. reduces the real debt burden owed by borrowers.
b
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Which of the following contributes to economic growth?
A) increase in environmental protection policies B) increase in labor regulations restricting the hours of overtime allowed C) increase in labor productivity D) increase in consumer spending
As the interest rate increases, the opportunity cost of waiting to receive a future amount:
A. increases. B. remains the same. C. decreases. D. may rise or fall.
Assume there is an increased demand in the United States for Australian wines. If all other factors are held constant, this will result in
A) an increase in the U.S. dollar exchange rate for Australian dollars. B) an appreciation of the U.S. dollar. C) a movement along the demand curve for Australian wine. D) a decrease in the par value of the Australian dollar.
In a large country, the effect of a given change in government spending
A) on output is large and the effect on the trade balance is small. B) on output is large and the effect on the trade balance is large. C) on output is small and the effect on the trade balance is small. D) on output is small and the effect on the trade balance is large.