The consumer price index is used to
a. monitor changes in the level of wholesale prices in the economy.
b. monitor changes in the cost of living over time.
c. monitor changes in the level of real GDP over time.
d. monitor changes in the stock market.
b
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Unanticipated deflation can create unemployment if
A) nominal wages are sticky, causing real wages to rise over time. B) nominal wages are flexible, causing people's real incomes to decline. C) banks refuse to make loans at low nominal interest rates. D) nominal interest rates remain positive.
What is the percentage of income received by the lower three quintiles on line K?
In a perfectly competitive market structure any firm can enter or leave the industry without serious impediments. This implies
A. firms will move labor and capital in pursuit of profit-making opportunities to whatever business venture gives them the highest return on their investment. B. consumers are able to find out about lower prices charged by other firms. C. the products sold will be alike. D. no one buyer or seller has any influence on price.
When the Federal Reserve wishes to, in the short run, increase real GDP, it
A. will increase the money supply by selling bonds. B. will increase the money supply by buying bonds. C. will decrease the money supply by selling bonds. D. has no policy options that will accomplish this.