Suppose that 2012 is the base year and the price deflater in 2016 is 104.5. Considering this, how are the prices in 2016 different from the price in 2012?
a. The 2016 prices are about 4.5 percent lower than the 2012 prices.
b. The 2016 prices are about 104.5 percent lower than the 2012 prices.
c. The 2016 prices are about 4.5 percent higher than the 2012 prices.
d. The 2016 prices are about 104.5 percent higher than the 2012 prices.
c. The 2016 prices are about 4.5 percent higher than the 2012 prices.
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Empirical evidence regarding the effects of devaluation on the balance of trade indicates that
A) devaluation generally improves the BOT. B) devaluation generally hurts the BOT. C) no strong generalizations are possible. D) devaluation has no effect on the BOT.
Puts and calls are the choices available to participants in the
A) options market. B) futures market. C) swap market. D) stock market.
In the ISLM framework, a rising price level causes
A) the equilibrium interest rate to rise. B) the equilibrium level of income to fall. C) desired saving to rise. D) the LM curve to shift to the right.
Acme Tools manufactures anvils, a forging tool. When the price of anvils was increased from $7 to $13, Acme Tools was willing and able to increase production from 1 to 4 units per day. Using the midpoint formula, what is Acme's price elasticity of supply for anvils?
a. 2 b. 1 c. 0.5 d. 4 e. 3.5