If the inflation turns out to be higher than people have expected, then
What will be an ideal response?
borrowers will gain and lenders will lose
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As output increases, the slope of the curve showing the firm's average fixed cost is
A) first negative, then positive. B) first positive, then negative. C) always negative. D) always positive.
If bus travel is an inferior good, then its income elasticity of demand will be:
a. strictly greater than one. b. positive. c. equal to zero. d. negative.
An increase in government spending is more likely to have a positive impact on jobs and output when
A. real GDP is above potential GDP. B. the economy is in a recession. C. the unemployment rate is below the natural rate. D. the business cycle is near the peak.
Answer the following questions true (T) or false (F)
1. One factor which brought on the recession of 2007-2009 was the financial crisis in 2008. 2. New classical macroeconomic theory emphasizes the role of "sticky" prices in the economy. 3. Monetarists believe that the quantity of money should be increased at an increasing rate.