A decrease in the rate of inflation will increase the rate of unemployment.
Answer the following statement true (T) or false (F)
True
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The demand curve for corn is downward sloping. If the price of corn, an inferior good, falls, then
A) the income effect which causes you to increase your corn purchases is larger than the substitution effect which causes you to reduce your corn purchases, resulting in a net increase in quantity demanded. B) the income effect which causes you to reduce your corn purchases is smaller than the substitution effect which causes you to increase your corn purchases, resulting in a net increase in quantity demanded. C) the income and substitution effects offset each other but the price effect of an inferior good leads you to buy less corn. D) both the income and substitution effects reinforce each other to increase the quantity demanded.
Of the world's countries, which of the following can be said of their real GDP growth rates in recent years?
A. Countries like China and India have experienced higher rates of growth than the U.S. B. The U.S. has always had the highest growth rate in the world. C. Neither of these statements is true. D. Both of these statements are true, since the U.S. was highest until 2010, when China surpassed it.
Which of the following would be an appropriate discretionary fiscal policy to use when the economy is in a recession?
a. Increased government spending. b. Higher taxes. c. A balanced-budget reduction in both spending and taxes. d. An expansion in the money supply.
If a firm is experiencing constant returns to scale, then the long-run average cost curve is
A) falling. B) rising. C) horizontal. D) shifting