Economic expansions might lead to inflation because an expansion leads to
A) a decrease in the unemployment rate, which decreases wages.
B) an increase in the unemployment rate, which decreases wages.
C) an increase in the unemployment rate, which increases wages.
D) a decrease in the unemployment rate, which increases wages.
D
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U.S. Treasury securities
A) are considered risk free because their prices never change. B) have been defaulted on several time in U.S. history. C) are considered default-risk-free instruments. D) have a large default risk premium.
In a command system, the decision about what should be produced is made by
a. a central authority b. the market c. repeating what was done in the past d. business firms e. consumers
In the short-run Keynesian model, to close a recessionary gap of $1 billion dollars government purchases must be:
A. increased by more than $1 billion. B. increased by $1 billion. C. increased by less than $1 billion. D. decreased by $1 billion.
Which of the following famous writers, along with Adam Smith, helped start modern economics with an examination of and rebuttal of mercantilism?
A) John Stuart Mill B) Milton Friedman C) Joseph Schumpeter D) David Hume