How did Milton Friedman define permanent income?
a) The present value of an individual's past incomes.
b) The present value of an individual's future stream of income.
c) The future value of an individual's past incomes.
d) The future value of an individual's future stream of income.
Ans: b) The present value of an individual's future stream of income.
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If the monthly unemployment rate increase mentioned in the Application wound up being a permanent and not temporary change, the best economic decision by the committee would most likely be to
A) decrease the money supply to stimulate the economy. B) not change monetary policy. C) decrease the money supply to slow the economy down. D) increase the money supply to stimulate the economy.
When there are few substitutes available for a good, demand tends to be relatively inelastic
Indicate whether the statement is true or false
Suppose that the U.S. imposed an import quota on beef. Sales of U.S. beef producers would
a. rise and exports of other industries would increase. b. rise and exports of other industries would decrease. c. not change, exports of other industries would increase. d. not change, exports of other industries would decrease.
If nominal GDP is declining, it is necessarily true that Real GDP is also declining
Indicate whether the statement is true or false