Inflation is a rise in:
A. The general level of prices over time
B. The standard of living over time
C. Unemployment over time
D. Real GDP over time
A. The general level of prices over time
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Refer to Figure 35.3 for the production possibilities curves for the United States and Mexico. These two curves indicate that
A. Mexico should specialize in the production of tomatoes. B. Mexico should specialize in the production of machinery. C. The United States should specialize in the production of machinery. D. The United States should specialize in the production of both goods because it has an absolute advantage in the production of both.
When the Fed uses monetary policy targets, they cannot use both a money supply target and an interest rate target at the same time because
A. It is easier for the Fed to keep track of, and influence, the interest rate B. Interest rates are determined by money supply and money demand that the Fed does not control money demand C. The Fed is only allowed to choose one target at a time to publish the Congress
Monetarists believe that the aggregate supply curve is relatively steep in the short and long runs. This means they expect
A. inflation with no change in output. B. increases in output to bring much inflation. C. increases in output to bring little inflation. D. decreases in output to bring much inflation.
Suppose that consumers expect the price of a product to decrease in the future. The result is that:
A. the current demand for the product increases. B. the current demand for the product decreases. C. the current supply of the product increases. D. the current supply of the product decreases.