How is the sacrifice ratio measured? How big is the sacrifice ratio in the United States? In other countries? What problems are there in measuring the sacrifice ratio?
What will be an ideal response?
The sacrifice ratio is measured as the percentage by which output falls below potential for every percentage point decline in inflation. In the United States, the sacrifice ratio is about 2, while other countries have sacrifice ratios ranging from 3/4 to 3. The sacrifice ratio is difficult to measure because it's hard to calculate what output would have been in the absence of disinflation and because supply shocks may distort the calculation.
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A) a substitute for camcorders. B) a complement to camcorders. C) an inferior good. D) a normal good. E) made using advanced technology.
What are correct incentives designed to eliminate?
What will be an ideal response?
Consider the two graphs above. Suppose that final goods are assembled only when ordered and to satisfy the precise preferences of each consumer. This would ________ the desired level of inventories, as depicted in graph ________
A) increase; B B) increase; A C) decrease; B D) decrease; A
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a. can be computed as the total income paid by firms or as expenditures on final goods and services. b. can be computed as the total income paid by firms, but not as expenditures on final goods and services. c. can be computed as expenditures on final goods and services, but not as the total income paid by firms. d. cannot be computed as either total income paid by firms or expenditures on final goods and services.