If inflationary expectations increase, the Phillips curve will
A. become upward sloping.
B. shift to the right.
C. become vertical.
D. shift to the left.
Answer: B
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A decrease in the real interest rate leads to a ________ the demand for loanable funds curve, and a decrease in the expected profit leads to a ________ the demand for loanable funds curve
A) rightward shift in; leftward shift in B) movement down along; movement up along C) rightward shift in; movement up along D) movement down along; leftward shift in
Over the most recent movements from cyclical peak to trough, 1990: Q3 to 1991: Q2, gross private domestic investment ________ approximately ________ percent
A) fell, 40 B) rose, 5 C) fell, 11 D) rose, 22
If fair insurance is offered to a risk-averse person, she will
A) buy enough insurance to eliminate all risk. B) not buy any insurance because it is overpriced. C) not buy any insurance since the marginal utility of the amount of the payment is positive. D) buy enough insurance to cover about half of the possible loss.
The assumption of a closed economy
a. applies to the world economy. b. applies to most national economies. c. requires us to assume that the government's budget is always balanced. d. All of the above are correct.