A substantial reduction in the rate of inflation is called:
A. inflation shock.
B. hyperinflation.
C. inflation inertia.
D. disinflation.
Answer: D
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The owners of preferred stock
A) receive preferential treatment in the payment of dividends. B) have the same voting rights as owners of common stock. C) are the original owners of the corporation. D) have the same rights as bondholders.
Sam quits his job as an airline pilot and opens his own pilot training school. He was earning $40,000 as a pilot. He withdraws $10,000 from his savings where he was earning 6 percent interest and uses the money in his new business. He uses a building he owns as a hangar that he could have rented out for $5,000 per year. He rents a computer for $1,200, buys office supplies for $500, rents an
airplane for $6,000 . pays $1,300 for fuel and maintenance, and hires one worker for $30,000 . Sam's total revenue from pilot training classes this year equaled $90,400 . Sam's explicit costs this year equal a. $84,400 b. $39,000 c. $55,000 d. $45,600 e. $40,000
Abstract economic theory can be used by academicians, but not by politicians or business people
a. True b. False Indicate whether the statement is true or false
In calculating the CPI, a fixed basket of goods and services is used. The quantities of the goods and services in the fixed basket are determined by
a. surveying consumers. b. surveying sellers of the goods and services. c. working backward from the rate of inflation to arrive at imputed values for those quantities. d. arbitrary choices made by federal government employees.