Assume individuals consider only the medium run effects of changes in future macro variables when forming expectations of future output and future interest rates. Suppose individuals expect the central bank to pursue a monetary expansion in the future. Given this information, we know with certainty that
A) current output and the current interest rate will both increase.
B) current output will decrease.
C) the current interest rate will decrease.
D) the current output effects are ambiguous.
E) current output will not change.
E
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Deflation is an overall:
A. rise in prices in the economy. B. decline in prices in the economy. C. rise in prices in the economy, excluding those with historically volatile price changes. D. decline in prices in the economy, excluding those with historically volatile price changes.
Keynes believed that economies experiencing high unemployment should adopt policies to
a. reduce the money supply. b. reduce government expenditures. c. increase aggregate demand. d. increase aggregate supply.
Imagine that ABC and? NBC, two publicly traded? companies, have just decided to merge their operations. When the merger between these firms takes? place, which type of organizational culture clash is LEAST likely to? occur?
A. Corporate values B. Communication practices C. Workplace atmosphere D. Management styles E. Stock valuation
Other things constant, the price elasticity of demand for a product will be smaller (more inelastic) if:
A. people spend a large share of their income on the product. B. people spend an insignificant share of their income on the product. C. the population in the market area is large. D. there are many good substitutes for the product.