Inflation results in
A) ease of planning for the future.
B) ease of comparing prices over time.
C) lower nominal interest rates.
D) difficulty interpreting relative price movements.
D
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If the quantity of credit supplied in a market exceeds the quantity of credit demanded in the market:
A) the unemployment rate tends to rise. B) the real rate of interest tends to rise. C) the rate of inflation tends to fall. D) the real rate of interest tends to fall.
Paul goes to Sportsmart to buy a new tennis racquet. He is willing to pay $200 for a new racquet, but buys one on sale for $125. Paul's consumer surplus from the purchase is
A) $325. B) $200. C) $125. D) $75.
Historical evidence shows that the relationship between interest rates and investment is
A) indeterminable. B) positive. C) negative. D) None of the above.
Refer to the information above. What is the level of unintended inventory investment when income is 850?
A) -175 B) 175 C) -200 D) 200