Refer to Scenario 16.3. What is the relative price of tee shirts to candy?
A) $2.25
B) $2
C) $1.40
D) The relative price will be between $2.25 and $1.40.
E) It is impossible to determine.
E
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Define what is meant by the period known as the short run
What will be an ideal response?
The classical model assumes that
A) imperfect competition predominates in most markets. B) people have money illusion. C) wages and prices are flexible. D) wages are flexible but prices are not.
A seasonal binary (or indicator or dummy) variable, in the case of monthly data,
A) is a binary variable that take on the value of 1 for a given month and is 0 otherwise. B) is a variable that has values of 1 to 12 in a given year. C) is a variable that contains 1s during a given year and is 0 otherwise. D) does not exist, since a month is not a season.
The view that excessive growth of the money supply over long periods leads to inflation:
A. is accepted by the monetarists but not by mainstream macroeconomists. B. is the main contribution of the rational expectations theory. C. had been absorbed into the mainstream of macroeconomics. D. is known as the monetary rule.