Economists believe that a little bit of inflation may be a good thing. What are the potential benefits of inflation?
First, economists believe that inflation "greases the wheels" of the labor market. Because workers resist cuts in nominal wages, a fall in real wages is more easily accomplished with a rising price level. Inflation thus makes it easier for real wages to adjust to changes in labor market conditions.
Second, the economy may need negative real interest rates to provide sufficient stimulus to aggregate demand. Inflation allows for the possibility of negative real interest rates
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Emocrats often argue in favor of what to push the economy toward economic recovery, as they did during the recession that began in 2008?
A. Tax cuts B. Increase government spending C. Decrease government spending D. Encourage the public to save more
The largest overall recipients of remittances are:
A. Chile and Mexico, which each get more than $50 billion per year. B. China and India, which each get more than $5 billion per year. C. China and India, which each get more than $50 billion per year. D. Chile and Mexico, which each get more than $5 billion per year.
Rick goes to work 8 hours per day, but while he is at work he spends most of his time visiting internet sites monitoring his fantasy football teams. This is an example of
a. the Condorcet Paradox. b. signaling. c. moral hazard. d. screening.
Refer to the information provided in Figure 7.8 below to answer the question(s) that follow. 
Figure 7.8Refer to Figure 7.8. The firm is currently along isocost CE. If the price of capital is $12, then the price of labor is
A. $8. B. $12. C. $80. D. $120.