The interest-rate effect is the impact on real GDP caused by the inverse relationship between the price level and the interest rate
a. True
b. False
Indicate whether the statement is true or false
False
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In perfect competition, an individual firm
A) faces unitary elasticity of demand. B) has a price elasticity of supply equal to one. C) faces a perfectly elastic demand. D) has perfectly elastic supply.
When the economy is at an above full-employment equilibrium, ________
A) nominal GDP exceeds real GDP B) an inflationary gap exists C) a recessionary gap exists D) real GDP is less than potential GDP
All of the following are types of finance companies EXCEPT
A) government finance. B) consumer finance. C) sales finance. D) business finance.
Nominal GDP is calculated by using
a. prices set in a base year. b. average prices in all major cities. c. current prices d. prices charged by initial producers.