According to classical macroeconomic theory,
a. the price level is sticky in the short run and it plays only a minor role in the short-run adjustment process.
b. for any given level of output, the interest rate adjusts to balance the supply of, and demand for, money.
c. output is determined by the supplies of capital and labor and the available production technology.
d. All of the above are correct.
c
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Which of the following is the most aggregated value?
A. total output of a city B. total output of an industry C. total output of a country D. total output of a firm
If the expected inflation rate was 2.5%, the expected real interest rate was 4.0%, and the actual inflation rate turned out to be 3.2%, then the real interest rate equals
A) 1.7%. B) 3.2%. C) 3.3%. D) 4.7%.
A good's nominal price is the:
A. average real price of the good. B. absolute price of the good in dollar terms. C. dollar price of the good relative to the average dollar price of all other goods and services. D. dollar price of the good relative to the real price of all other goods and services.
The idea that consumers continue to adjust their purchases until the marginal utility per last dollar spent on all items is equal is called the
A. law of increasing costs. B. consumer optimum. C. rule of 72. D. law of diminishing marginal utility.