The CPI in year one equaled 1.55. The CPI in year two equaled 1.64. The rate of inflation between years one and two was ________ percent.
A. 9.0
B. 5.8
C. 4.0
D. 6.4
Answer: B
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Suppose the production possibilities for two countries, producing either food or clothing, are shown in the above figure. They can each produce any linear combination as well. Once free trade is allowed, Canada will produce
A) no clothing. B) 10 units of clothing. C) 20 units of clothing. D) 5 units of clothing.
During the 1990s, the United Kingdom experienced low levels of inflation while Turkey experienced high levels of inflation. A likely explanation of these facts is that
a. the United Kingdom has a better education system than Turkey. b. the rate of growth of the quantity of money was slower in the United Kingdom than in Turkey. c. workers in Turkey are more productive than workers in the United Kingdom. d. there are more instances of market power in Turkey than in the United Kingdom.
Governments grow because low income individuals cannot use the political process to redistribute income towards themselves.
A. True B. False C. Uncertain
Over the long haul, rapid increases in the supply of money lead to
A) inflation. B) higher levels of production and real output. C) rapid growth of real wages. D) lower unemployment rates