Tina Eckstrom and her husband bought a deferred annuity that started paying them $700 a month in retirement benefits. They, along with millions of other people who live on fixed incomes, are examples of:
A. those who are responsible for inflation.
B. the big winners from inflation.
C. the big losers from inflation.
D. the paradox of thrift.
Answer: C
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In the expanded circular flow diagram, the rest of the world interacts directly with
A) product markets. B) factor markets. C) households. D) firms.
An open economy has GDP of $1,000 billion, consumption of $650 billion, government expenditures of $150 billion, and domestic investment of $40 billion. What is its demand for loanable funds?
a. $40 billion b. $120 billion c. $160 billion d. $200 billion
Under a "crawling peg" system, a country's exchange rate
A) is fixed except for small, surprise changes. B) changes at a predetermined rate against the dollar or some other major currency. C) can fluctuate within a narrow band. D) can change, but the changes are kept secret from the public. E) is determined by the central bank of another country.
The possibility that the economy may benefit from having market power, rather than being very competitive, is closely identified with which famous economist?
A) Arnold Harberger B) Joseph Schumpeter C) Sergey Brin D) Donald Turner