If the nominal GDP were to increase, but the real GDP were to increase by less from one year to the next, we could conclude:
A. both prices and output went up.
B. both prices and output stayed the same.
C. prices stayed the same, but output went up.
D. prices went up, but output stayed the same.
Answer: A
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The kinked demand curve model explains pricing in monopoly markets.
Answer the following statement true (T) or false (F)
Refer to Figure 7.2. The marginal product of the second worker is ________ lawns moved.
A) 3 B) 5 C) 8 D) 11.
Using an approximation to the UIP eqaution to determine the spot exchange rate, assume that the expected spot rate (after 1 year) for euros (in terms of dollars)= $1.50, the current interest rate on euro deposits is 2% and the current interest rate on dollar deposits is 6%. What current spot for euros would satisfy the equation?
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