Which of the following describes a situation in which the person is hurt by inflation?
A) a retiree whose pension is adjusted for inflation
B) a person who borrows money during a period when inflation is under-predicted
C) a person who lends money during a period when inflation is over-predicted
D) a person paid a fixed income during an inflationary period
Answer: D
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Which of the following was not one of the principles on which the General Agreement on Tariffs and Trade (GATT) was established?
A. The elimination of import quotas. B. Equal, nondiscriminatory trade treatment for all member nations. C. The formation of international trade contracts to alleviate global poverty. D. The reduction of tariffs by multilateral negotiations.
If exports increase, then the aggregate expenditure curve shifts ________ and equilibrium expenditure ________
A) upward; decreases B) upward; increases C) downward; increases D) downward; decreases E) upward; does not change
Suppose that elasticity has been reliably measured as 1.55 and the unit price decreases from $20 to $17.50. How much will quantity demanded increase?
What will be an ideal response?
Assume that the central bank increases the reserve requirement. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the real risk-free interest rate and real GDP in the context of the Three-Sector-Model?
a. The real risk-free interest rate rises, and real GDP remains the same. b. The real risk-free interest rate rises, and real GDP falls. c. The real risk-free interest rate and real GDP remain the same. d. The real risk-free interest rate falls, and real GDP rises. e. There is not enough information to determine what happens to these two macroeconomic variables.