A cost of inflation is that it:
A. reduces the informational content of prices.
B. makes everyone poorer.
C. makes the poor poorer and the rich richer.
D. it raises real interest rates.
Answer: A
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The dominant school of economic thought until midway through the Great Depression of the 1930s was:
a. classical. b. Keynesian. c. monetarism. d. supply-side. e. rational expectations.
It is not possible for both parties to gain in a voluntary trade.
Answer the following statement true (T) or false (F)
If the central bank decreases the money supply, then output
a. and unemployment rises. b. rises and unemployment falls. c. falls and unemployment rises. d. and unemployment falls.
Figure 11-3
In Figure 11-3, which line represents the change in the consumption schedule caused by an increase in the residential property tax?
a.
C1 in graph (a)
b.
C2 in graph (a)
c.
C1 in graph (b)
d.
C2 in graph (b)