Economists agree that the CPI
A) is a near perfect measure of the cost of living.
B) has no relation to the cost of living.
C) is a possibly biased measure of the cost of living.
D) almost always shows the cost of living rising less rapidly than is the case in reality.
E) overstates inflation by about 4.1 percentage points a year.
C
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According to this Application, the recession in 1981 was caused by
A) the government cutting back on aggregate demand to reduce inflation. B) increasing oil prices which resulted in a decrease in aggregate supply. C) massive immigration from Europe to the United States. D) an decrease in aggregate supply resulting from U.S. bank collapses.
Explain monetary policy goals and discuss any goal conflicts in the long run and the short run
What will be an ideal response?
________ creates an informational equilibrium in which people trust the wisdom of others and ignore their own information
A) Anchoring B) Hedging C) Sniping D) Herding
Which of the following do development economists NOT recommend to nations seeking to increase their rates of economic growth?
A) protecting home producers from international competition B) letting creative destruction run its course C) promoting increased education D) promoting private property rights