At the beginning of a year, decision makers expect the general level of prices to increase at a 3 percent annual rate. The CPI increases from 150 to 154.5 during the year; this is an example of
a. an inflation rate that is equal to 4.5 percent.
b. an unanticipated increase in the general level of prices.
c. an increase in the general level of prices that was accurately anticipated.
d. an inflation rate that is less than what people anticipated.
C
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The marginal value that a consumer places on the last unit can be read off of the
a. demand curve. b. supply curve. c. contract curve. d. production possibility curve.
Someone who turns down an opportunity to purchase a Bible for $5 and then immediately pays $5 to attend a movie thereby expects to obtain more satisfaction from seeing the movie than from
A) cultivating the spiritual life. B) deepening his religious faith. C) owning the Bible just offered to him. D) reading the Bible.
If the price of inputs rises and consumer expectations about future economic activity worsens:
a. Price index rises, and real GDP rises. b. Price index rises, and real GDP falls. c. Price index rises, and the change in real GDP is uncertain. d. Price index falls, and real GDP rises. e. The change in price index is uncertain, and real GDP falls.
Sheena lost her job as a sales manager when she quit to move to Texas. She is currently submitting applications and doing job interviews. What type of unemployment is this?
a. structural b. cyclical c. she is not unemployed d. frictional