Rapid ________ in prices during periods of ________ is known as stagflation.
A. decreases; recession
B. increases; expansion
C. increases; recession
D. decreases; expansion
Answer: C
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If black markets help people meet their needs, they will tend to ________ created by the restrictive government policies
A) increase the absolute advantage B) reduce the deadweight losses C) reduce the cooperative surpluses D) increase the tax revenues
In the figure above, if the market is unregulated,
A) more than the efficient amount of output will be produced. B) less than the efficient amount of output will be produced. C) the allocation of resources will be efficient because the efficient amount of output will be produced. D) the deadweight loss will be zero.
You sign a contract to pay $1000 next year for the refrigerator you bought today. The rate of inflation is 10% and the real interest rate is 7%. Alternatively, you could pay $875 today. What should you do to save the most money?
What will be an ideal response?
If aggregate expenditure in an economy equals 3,000 + 0.75Y and full employment real GDP equals 12,000, then this economy has
A. no autonomous expenditure. B. a recessionary gap. C. an inflationary gap. D. no output gap.