When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand
B. increase; raise; decline
C. decline; lower; decline
D. decline; raise; decline
Answer: B
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Indicate whether the statement is true or false
Which of the following will cause a decrease in producer surplus?
a. the imposition of a binding price ceiling in the market b. an increase in the number of buyers of the good c. income increases and buyers consider the good to be normal d. the price of a complement decreases
In a pizza industry, the cost of the factory is a(n) __________ only in the short run but not in the long run.
Which of the following people would not be included among the unemployed?
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