The dollar value of GDP increased approximately 4 percent during the year, but real GDP fell 2 percent. Which of the following best explains this data?
a. The real capacity of the economy increased more rapidly than money output.
b. In the international sector, there was a balance of trade deficit of approximately 2 percent of GDP.
c. The inflation rate was approximately 6 percent during the year.
d. The general level of prices rose approximately 2 percent.
C
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While in school, Kiki spends 20 hours a week as a computer programmer for Microsoft and studies 30 hours a week
A) Kiki is classified as a full-time worker, working 50 hours a week. B) Kiki is classified as a part-time worker, working 30 hours a week. C) Kiki is classified as a part-time worker, working 20 hours a week. D) Because Kiki is a student, she is not classified as working. E) Because Kiki is a student, she is classified as a full-time worker, working 20 hours a week at a paid job.
If the three-month Treasury bill has an interest rate of 0.2%, the ten-tear Treasury bond has an interest rate of 2.75%, and a ten-year bond issued by Time Warner has an interest rate of 6%, what is the risk premium on Time Warner's bond?
What will be an ideal response?
Which panel of Figure 3.3 represents the changes in the market for textbooks when the cost of paper decreases and the government increases the number of student loans it grants?
A. A. B. B. C. C. D. D.
In 1979, the Federal Reserve decided to tighten monetary policy in order to reduce inflation, which had risen to double-digit levels. The AD/AS model framework suggests that the short-run effect of this policy was to reduce:
A. neither inflation nor output. B. inflation primarily with little change in output. C. output primarily with little change in inflation. D. both inflation and output.