In the long run, the purchasing power parity theory predicts exchange rates accurately, particularly when there is a large difference in inflation rates across countries
Indicate whether the statement is true or false
True
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Per capita real GDP is a measure of
A) productive activity. B) economic welfare. C) cost of living standards. D) cultural harmony.
Keynes (1941) claimed that government spending during wartime could generate a healthy increase in the demand for output, thus raising employment levels and boosting incomes
To avoid inflation, physical rationing, monetary measures and other controls were consequently needed. Indicate whether the statement is true or false
Implicit costs are the
a. opportunity costs of using resources owned by the entrepreneur in his/her own business b. payments the business owner must make on borrowed funds c. costs which vary as the level of output varies d. payments the business owner makes in cash e. payments the business owner makes for public relations, such as donations to charity
In which of the following cases will total revenue increase?
A. Price falls and demand is inelastic. B. Price falls and supply is elastic. C. Price rises and demand is inelastic. D. Price rises and demand is elastic.