The nominal rate of interest is the difference between the real rate and the expected rate of inflation
a. True
b. False
Indicate whether the statement is true or false
False
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The Soviet Union's economy grew rapidly in terms of GDP per hour worked in the 1950s, but eventually this growth slowed. Why did this occur?
A) Capital per hour worked grew rapidly from 1950 to 1980, but technological change occurred very slowly. B) Increasing implementation of new technologies eventually suffered diminishing marginal returns. C) Capital per hour worked grew slowly, but technological change grew very rapidly. D) The centrally planned economy invested too heavily in technological change.
Goods produced that go into inventories are
a. not counted in GDP. b. only counted in GDP when they are ultimately sold. c. counted in GDP even though they are not sold. d. counted if they completely depreciate within the calendar year.
The national debt is a larger percentage of GDP now than at any time since 1900
Indicate whether the statement is true or false
Which of the following statements best describes the role played by prices in a command economy such as the former Soviet Union?
A. Prices were used to allocate resources. B. Prices played the same role as in a market economy. C. Prices were used to ration final goods and services but not to allocate resources. D. Prices were not used at all.