An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase
B. increase; increase
C. decrease; decrease
D. increase; decrease
Answer: D
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Walmart wants to raise $250 million to finance the renovation of their retail stores, and the company wishes to raise the funds through indirect finance. Which of the following methods could it use?
A) It could issue $250 million in stock. B) It could sell $250 million in bonds. C) It could borrow $250 million from a bank. D) It could choose either A or B.
If two countries agree to specialize and trade based on comparative advantage, which of the following is most likely to be TRUE?
A) Both of the countries will consume outside their respective production possibilities curves. B) One of the countries will end up receiving all of the gains from trade. C) One of the countries will both consume and produce on its production possibilities curve. D) Only one of the countries will produce on and consume outside its production possibilities curve.
A perfectly competitive producer's demand curve is:
a. a horizontal line. b. also the market-demand curve. c. downward sloping but more elastic than the market-demand curve. d. a vertical line. e. upward sloping.
A ______ chance of default will cause the interest rate to be ______.
A. more variable; lower B. less variable; higher C. higher; lower D. higher; higher