If the demand for consumer goods increases, the parity price ratio falls
Indicate whether the statement is true or false
T
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When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline
Quasilinear goods are borderline goods between the set of normal and the set of inferior goods.
Answer the following statement true (T) or false (F)
A Minnesota farmer buys a new tractor made in Iowa by a German company. As a result,
a. U.S. investment and GDP increase, but German GDP is unaffected. b. U.S. investment and German GDP increase, but U.S. GDP is unaffected. c. U.S. investment, U.S. GDP, and German GDP are unaffected because tractors are intermediate goods. d. U.S. investment, U.S. GDP, and German GDP all increase.
Economic analysis requires both mathematical reasoning and historical study.
Answer the following statement true (T) or false (F)