An increase in the purchasing power of money need not lead to an increase in the purchasing power of income because the falling price level would likely mean falling wages and salaries
Indicate whether the statement is true or false
TRUE
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The federal funds rate is the interest rate that
A) the Fed charges to banks that borrow from it. B) banks charge the Fed for using their reserves. C) banks charge each other for borrowed money. D) the Fed pays on bank reserves.
The key distinction that separates endangered resources from sustainable resources is the nature of
A) externalities. B) transactions costs. C) property rights. D) overall consumption.
Which of the following is not a question that macroeconomists address?
a. Why is average income high in some countries while it is low in others? b. Why does the price of oil rise when war erupts in the Middle East? c. Why do production and employment expand in some years and contract in others? d. Why do prices rise rapidly in some periods of time while they are more stable in other periods?
Changes in the producer price index are often thought to be useful in predicting changes in
a. stock prices. b. the consumer price index. c. the unemployment rate. d. the rate of output of goods and services.