A direct relationship exists when:
a. there is no association between two variables.
b. one variable increases and there is no change in the other variable.
c. one variable increases and the other variable increases.
d. one variable increases and the other variable decreases.
c
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If inflation is eight percent, a nominal interest rate of six percent translates into a real interest rate of two percent
Indicate whether the statement is true or false
U.S. import spending is not affected by U.S. real income but is influenced by the economic activity of its major trading partners and the exchange rate, hence import spending is taken as autonomous
Indicate whether the statement is true or false
Revenues from social insurance taxes are earmarked to pay for Social Security and Medicare
a. True b. False Indicate whether the statement is true or false
When the Fed increases the money supply, we expect
a. interest rates and stock prices to rise. b. interest rates and stock prices to fall. c. interest rates to rise and stock prices to fall. d. interest rates to fall and stock prices to rise.