When the value of a payment is adjusted in proportion to changes in the CPI, economists refer to that as
a. nominalization
b. realization
c. indexation
d. stabilization
e. depreciation
C
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Which of the following provides support for the use of discretion in economic policy-making?
A) any policy rule that is based on a particular model will prove wrong if that model is wrong B) the existence of a political business cycle C) the conclusions of Friedman and Schwartz with respect to monetary and fiscal policy D) the Watergate scandal
The primary disadvantage of engineering methods for measuring cost functions is that they deal with the managerial and entrepreneurial aspects of the production process or plant
a. true b. false
If aggregate expenditures exceed real GDP, then:
a. employment falls. b. the economy will have deflation. c. firms are depleting their inventories. d. the money supply will increase.
What is one of the traditional political uses of tariffs?
a. protection of borders b. protection of vested economic interests c. protection of military secrets d. protection of exchange rates