The Phillips curve represents an inverse relationship between the inflation rate and the unemployment rate

a. True
b. False
Indicate whether the statement is true or false


True

Economics

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The self-correcting property of the economy means that output gaps are eventually eliminated by:

A. increasing or decreasing potential output. B. government policy. C. decreasing inflation only. D. increasing or decreasing inflation.

Economics

Nicaragua in the early 2000s set its exchange rate with the U.S. dollar to decrease monthly by 1%. This is an example of

A) a crawling peg. B) bad currency management. C) a parity band. D) a currency board.

Economics

Suppose a basket of goods costs $400 in the United States and £200 in Britain. If the exchange rate is $1/pound, what will happen in the foreign exchange market, according to the purchasing power parity theory?

a. The market will go further out of equilibrium because of increased activity. b. An increase in demand for pounds will lead to an increase in the price of pounds. c. An increase in demand for dollars will lead to an increase in the price of dollars. d. An increase in demand for dollars will lead to a decrease in the price of dollars. e. An increase in demand for pounds will lead to a decrease in the price of pounds.

Economics

Give an example of a famous cartel

Economics