Suppose that the Fed expects to increase the money supply by $49 billion, but economic agents expect that the increase will be closer to $75 billion. Using rational expectations theory, the result will be ______________ Real GDP and a ________________ price level
A) lower; higher
B) lower; lower
C) higher; higher
D) higher; lower
A
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When a positive externality exists,
A. external benefits are necessarily greater than private benefits. B. social benefits are greater than private benefits. C. social benefits are less than private benefits. D. social benefits equal private benefits. E. none of the above
When economists use the term ceteris paribus, they are indicating that
a. the relationship between two economic variables cannot be determined. b. the analysis is true for the individual but not for the economy as a whole. c. all other variables except the ones specified are assumed to be constant. d. their conclusions are based on normative economics rather than positive economic analysis.
When electronic digital wristwatches were first introduced in 1972 they were priced at $2,100. If the CPI in 1972 was 42 and the CPI in 2019 is 275, then this price is equivalent to approximately ______________________in 2019 dollars.
A. $20,950 B. $11,650 C. $13,750 D. $245 $321
The current rate of unemployment of 5 percent is too high. This is a _______ statement.
A) normative B) ceteris paribus C) positive D) fallacy of false cause