Which of the following statements about inflation is correct?
a. Evidence from studies indicates that, in U.S. newspapers, inflation is mentioned less frequently than other economic terms, such as unemployment and productivity.
b. People believe the inflation fallacy because they tend to believe too strongly in the principle of monetary neutrality.
c. Nominal incomes are determined by nominal factors; they are not affected by real factors.
d. Inflation does not in itself reduce people's real purchasing power.
d
You might also like to view...
If the institutions in an economy change from being inclusive to extractive, the return-to-entrepreneurship schedule in the economy will:
A) become horizontal. B) shift rightward. C) become vertical. D) shift leftward.
The National Industrial Recovery Act of 1933 increased competition among firms
Indicate whether the statement is true or false
Which of the following statements are true regarding profit maximizing firms? a. They will attempt to maximize the difference between total revenues and total costs. b. They will use more of a resource as long as the MRC is greater than the MRP
c. They will only produce where MRP is positive and MRC is negative. d. none of the above.
You have a bond that pays $60 per year in coupon payments. Which of the following would result in an increase in the price of your bond?
A) Coupon payments on newly-issued bonds rise to $80 per year. B) The likelihood that the firm issuing your bond will default on debt increases. C) The price of a share of stock in the company falls. D) Coupon payments on newly-issued bonds fall to $50 per year.