The creation of the European Monetary Union in 1999 lowered nominal interest rates in countries like Italy, because:
a. The creation of a supranational central bank reduced expected inflation.
b. The supranational central bank increased the money supply rapidly, thereby causing interest rates to fall.
c. Actually, interest rates in Italy exploded after the creation of the European Monetary Union, due to the lack of initial confidence in the European Central Bank.
d. All of the above.
e. None of the above.
.A
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Aggregate expenditure is total:
A. spending on final goods and services. B. value added in the economy. C. revenue from the sale of goods and services. D. income of households, businesses, governments, and foreigners.
In the long run, a reduction in productivity will cause
A) an increase in the capital—labor ratio and an increase in consumption per worker. B) an increase in the capital—labor ratio and a decrease in consumption per worker. C) a decrease in the capital—labor ratio and a decrease in consumption per worker. D) a decrease in the capital—labor ratio and an increase in consumption per worker.
It is impossible to create a free market system that promotes economic efficiency
Indicate whether the statement is true or false
A rightward movement along a country's aggregate production function implies labor capital deepening
a. True b. False Indicate whether the statement is true or false