Suppose that the rate of inflation in Japan is 1 percent and the rate of inflation in the United States is 3 percent. If the real exchange rate remains constant, the value of the U.S. dollar relative to the yen must:
A. fall by 2 percent.
B. fall by 4 percent.
C. rise by 4 percent.
D. rise by 2 percent.
Answer: A
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Evidence shows that many people who delay searching for a job for a year or longer after they are laid off
A) find that they have little to no chance to find new employment after being unemployed for so long. B) find it easier to find new employment than if they had searched for a new job soon after they were laid off. C) find that the extra unemployment benefits they receive during their extended period of unemployment more than make up for the difficulty in finding a job once they decide to re-enter the workforce. D) find it more difficult to find new employment than if they had searched for a new job soon after they were laid off.
The disposable income component of aggregate demand is equal to:
a. income before taxes. b. income after taxes. c. operating income. d. investment income.
Refer to the information provided in Figure 2.5 below to answer the question(s) that follow.
Figure 2.5Refer to Figure 2.5. The marginal rate of transformation in moving from Point A to Point B is
A. -2/3. B. -1.5. C. -3. D. -30.
To combat inflation, Congress and the president should
A) increase transfer payments. B) decrease taxes. C) decrease government spending. D) raise interest rates.