In the above figure, as more ukuleles are produced, the opportunity cost in terms of guitars is
A. zero.
B. constant.
C. increasing.
D. decreasing.
Answer: C
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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
An increase in the price level ________ the aggregate quantity supplied and ________ the aggregate quantity demanded
A) increases; decreases B) does not change; decreases C) decreases; increases D) decreases; decreases E) increases; increases
Which of the following is not an advantage of the chain weighted CPI over the fixed CPI?
a. the chain-type index includes newer products b. the chain index incorporates the increase in the quality of goods c. the chain index includes discounting and the substitution of products d. the chain index includes the price of the product only at standard prices
Suppose that the economy experiences an increase in the inflation rate at the same time that the unemployment rate decreases. This situation indicates a:
A. shift in the Phillips curve. B. movement along a vertical Phillips curve. C. movement along a negatively-sloped Phillips curve. D. movement along a positively-sloped Phillips curve.