What is the main problem with mild inflation according to some economists?
A. It reduces the size of the GDP gap
B. It leads to unanticipated deflation
C. It increases frictional and structural unemployment in the economy
D. It diverts productive time towards activities to hedge against inflation
D. It diverts productive time towards activities to hedge against inflation
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Suppose that Year 1 is the base year. Year 2 real GDP is
A) $200. B) $270. C) $310. D) $390.
A manager bidding in an auction with independent private values for a large piece of industrial equipment has estimated that the expected profit from the equipment is $10 million. If the manager is indifferent about the uncertainty surrounding the expected profit of the equipment, the manager is ________ and the manager's value of the truck is ________.
A) risk averse; $10 million B) risk neutral; $10 million C) risk averse; less than $10 million D) risk neutral; less than $10 million
The Fed never processes immigrating checks that must pass between different Federal Reserve banks
Indicate whether the statement is true or false
Vertical equity refers to the idea that
A. people with greater ability to pay should pay more. B. people who are situated differently should pay differently but in a manner deemed fair by society. C. people who are situated equally should pay equally. D. the people who derive the benefits from services should be the ones who pay for the services, provided they have the ability to pay.