To achieve long-run equilibrium in an economy with a recessionary gap, without the use of stabilization policy, the inflation rate must:
A. not change.
B. increase.
C. decrease.
D. either increase or decrease depending on the relative shifts of AD and AS.
Answer: C
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An import quota will ________ producer surplus, ________ consumer surplus, ________ government revenue, and ________ overall domestic national welfare
A) increase; decrease; increase; have an ambiguous effect on B) increase; decrease; decrease; decrease C) increase; decrease; have no effect on; have an ambiguous effect on D) increase; decrease; have no effect on; decrease E) increase; increase; decrease; have an ambiguous effect on
The consumer price index:
a. tracks the value of output over time. b. is not tied to cost-of-living adjustments. c. doubles every five years in the economy. d. is a weighted average of consumer prices. e. is a broader price index measure than the implicit GDP deflator.
The Consumer Price Index is based on the price level of a basket of goods and services that represents the purchases of an average consumer
a. True b. False Indicate whether the statement is true or false
Would we expect the "average" person to take more time to learn about the car he or she is considering purchasing or about the issues in the upcoming U.S. Senate race in his or her state?
A) The Senate race, because it is critical that we elect the right people to government. B) The car, but there is no rational reason for this. C) The Senate race, because the person who is elected senator today may become president tomorrow. D) The car, because a mistake here can potentially cause him or her more harm on a day-to-day basis; in addition, a person is unlikely to be able to determine the outcome of a Senate race.