A member of a cartel earns more profits by producing more than its quota and selling at a price higher than the cartel's price
Indicate whether the statement is true or false
FALSE
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If the expected rate of inflation is zero, the real interest rate must
a. also equal zero. b. be greater than the money (nominal) interest rate. c. be equal to the money (nominal) interest rate. d. be less than the money (nominal) interest rate.
Baumol argued that in an economy where productivity is growing in most sectors (called progressive sectors) and lagging in a few (non-progressive sectors), employment can still increase in the non-progressive sectors:
a. if employers in the non-progressive sectors lower wages. b. by investing in more labor-saving technology in the non-progressive sector. c. by raising prices in all sectors. d. as long as resources are transferred to the progressive sector. e. by transferring resources from cost-saving innovation in the progressive sector to the non-progressive sector
The production possibilities curve shows various combinations of two products that an economy can produce when there is full employment and economic efficiency.
a. true b. false
Economic growth is measured by the percentage change in:
A. ?potential nominal GDP. B. ?structural unemployment. C. ?the rule of 72. D. ? potential real GDP (LRAS).?