An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase
B. increase; increase
C. decrease; decrease
D. increase; decrease
Answer: D
You might also like to view...
In which of the following markets are external benefits most likely to exist?
A) in the market for gasoline B) in the market for ball pens C) in the market for flu shots D) in the market for cigarettes
Economists use the term inflation to describe a situation in which the economy's overall price level is rising
a. True b. False Indicate whether the statement is true or false
The welfare of sellers is measured by
a. consumer surplus. b. producer surplus. c. total surplus. d. price.
Suppose the market for shoes consists of three consumers. The table below shows the quantity demanded at various prices for each consumer:Price PerPairPairs Demandedby PatPairs Demandedby LeighPairs Demandedby Chris$100010$75031$50173$302105The data suggest that Leigh:
A. does not like shoes. B. prefers shoes to other items that are for sale. C. has a higher income than either Pat or Chris do. D. has a greater demand for shoes than either Pat or Chris do.