Assume that the economy is at a long run equilibrium and oil prices rise. As a result, the ________ shifts ________
A) AD; rightward
B) AD; leftward
C) SAS; rightward
D) SAS; leftward
D
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The core inflation rate measures changes in the
A) prices of consumer goods except health care. B) prices of all consumer goods. C) prices of consumer goods except food and fuel. D) price of only two consumer goods: food and fuel. E) prices of all the "core" goods and services a typical family buys.
Theory in economics
a. involves some simplification of reality b. bears no relation to reality c. approaches reality in all its complexity d. involves so much distortion of reality that it is worthless e. focuses on the unique aspects of each situation
Suppose that the wage for musicians decreases relative to other occupations. We know that ________ people will work in music, and the total number of hours worked will ________.
A. more; increase B. more; decrease C. fewer; increase D. fewer; decrease
(Consider This) The ratchet effect is the tendency
A. the price level to increase but not to decrease. B. nominal GDP to increase more rapidly than real GDP. C. real interest rates to fall more rapidly than nominal interest rates. D. consumption to rise year after year regardless of what happens to disposable income.