Inflation measures the increase in the quantity of goods and services produced from each hour of a worker's time
a. True
b. False
Indicate whether the statement is true or false
False
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The AD curve shows the sum of
A) the price level, employment, and real GDP. B) consumption expenditure, investment, and real GDP. C) consumption expenditure, investment, government expenditures on goods and services, and net exports. D) consumption expenditure, investment, the price level, and real GDP.
After a temporary beneficial supply shock hits the economy, general equilibrium is restored by
A) a shift down and to the left of the IS curve. B) a shift to the left of the FE line. C) a shift up and to the left of the LM curve. D) a shift down and to the right of the LM curve.
Every six weeks, the Federal Open Market Committee (FOMC) meets to discuss how to best adjust ________ to accommodate shocks that shift the level of ________
A) the equilibrium real interest rate; the target Fed Funds rate B) the target Fed Funds rate; the equilibrium real interest rate C) the 3 month T-bill rate; the inflation gap D) target rate of inflation; money demand E) none of the above
According to the Law of Diminishing Marginal Returns, as additional units of one input are employed as all other inputs are held constant, total output will eventually ______.
A. decrease B. increase at an increasing rate C. increase at a decreasing rate D. increase at a constant rate