A period in which the economy is growing at a rate significantly above normal is called a(n):
A. depression.
B. recession.
C. expansion.
D. peak.
Answer: C
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An example of the new goods bias in the CPI is the
A) introduction of higher quality brakes as standard equipment on new cars. B) introduction of hybrid automobiles, vehicles that were not made until recently. C) decreasing popularity of SUVs as the price of gasoline has risen. D) switch from traditional car dealerships to low-cost Internet car buying services.
What are the two basic reasons inside lags occur?
What will be an ideal response?
It is likely that the owners have little to do with the day-to-day management of a firm in the case of
A) partnerships only. B) proprietorships only. C) corporations only. D) partnerships and corporations.
Most economists agree that modest inflation is desirable over zero inflation because:
A. it helps firms to more easily adjust real wages. B. it allows a margin of error for those deciding on the money supply. C. it allows the Fed to more easily engage in expansionary monetary policy. D. All of these statements are true.