Which of the following perspectives believes that both wages and prices are stuck in the immediate short run and that prices are inflexible downward but flexible upward?
A. Monetarism.
B. Mainstream economists.
C. Rational expectations economists.
D. None of these—they all see wages and prices as flexible.
B. Mainstream economists.
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Use the saving and investment equation to explain why the United States experienced large current account deficits in the late 1990s
What will be an ideal response?
Assume that foreign capital flows from a nation increase due to political uncertainly and increased risk. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the quantity of real loanable funds per time period and net nonreserve international borrowing/lending balance in the context of the Three-Sector-Model? a. The quantity of real
loanable funds per time period falls and net nonreserve international borrowing/lending balance becomes more negative (or less positive). b. The quantity of real loanable funds per time period rises and net nonreserve international borrowing/lending balance becomes more negative (or less positive). c. The quantity of real loanable funds per time period falls and net nonreserve international borrowing/lending balance becomes more positive (or less negative). d. The quantity of real loanable funds per time period and net nonreserve international borrowing/lending balance remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
At least in the short run, each of these factors has increased competition except
A. the entry of foreign firms. B. the growth in size of many American firms. C. the rise of the service industries. D. the rise of new industries.
When Pierre in Paris, France buys stock in Disney, Inc., he is contributing to:
A. domestic investment in the U.S. B. capital outflow from the U.S. C. capital inflow to the U.S. D. private savings in the U.S.