If an increase in income results in a rightward parallel shift of the demand curve, then at any given price, the price elasticity of demand will have
A) increased in absolute terms.
B) decreased in absolute terms.
C) remained unchanged.
D) increased, decreased or stayed the same. It cannot be determined.
B
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In 1990, U.S. nominal GDP was $5,744 billion and the GDP chain price index is 93.6 . Real GDP is:
a. $6,137 billion. b. $5,376 billion. c. $6,000 billion. d. $6,376 billion.
Public debt promotes overconsumption if
a. foreigners hold the debt b. people fail to regard bonds as their personal assets c. people view the government's liabilities as their own d. the Federal Reserve buys bonds e. people regard their bond holdings as part of their savings
Member countries of the Eurosystem agree to:
A. pursue independent domestic monetary policies based on what is best for their own country, but not all member countries have adopted the euro as their currency. B. share a common monetary policy and use the euro as their currency. C. use the euro as their currency, but each country still pursues an independent monetary policy. D. share a common monetary policy and fiscal policy.
When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline