Monetary and price instability will
What will be an ideal response?
Generate uncertainty, and encourage investors and businesses to move their activities to countries with a more stable monetary environment
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Emotions like guilt and sympathy:
A. reduce the likelihood that a transaction will maximize total economic surplus. B. can solve commitment problems, but generally reduce players' payoffs. C. are irrelevant to economic decision-making. D. can solve commitment problems.
Money is best defined as
A) anything that can be sold to pay for something. B) currency. C) anything that is backed by gold. D) anything accepted as a means of payment. E) anything that has value.
The natural rate hypothesis asserts that
A) changes in the unemployment rate from changes in the inflation rate are temporary. B) changes in the unemployment rate are natural and long-lasting. C) when prices change, the inflation rate changes temporarily and then returns to its natural rate. D) changes in the natural unemployment rate are only temporary. E) price changes occur at a natural rate, near a 6 percent average inflation rate.
Refer to Figure 2-13. Which two arrows in the diagram depict the following transaction: Lizzie Haxem hires "The Paint Pros," a professional painting company, to paint her home
A) J and G B) K and M C) K and G D) J and M