The short-run Phillips curve always intersects the long-run Phillips curve at:
a. Zero inflation
b. At an accelerating inflation rate.
c. The expected inflation rate.
d. The same rate over time.
c
You might also like to view...
Suppose Gerald works for Lola as a production assistant. Gerald and Lola fall in love, get married and have children. Gerald stops working for Lola in order to care for the children. What will be the effect of this scenario on GDP?
A) GDP will increase. B) GDP will decrease. C) GDP will not change. D) GDP may increase or decrease depending on the rate of inflation.
One difference between a policy of direct spending by the government on research and development and an alternative policy of tax incentives to encourage private spending on R&D is ________
A) the former improves the productivity of R&D, while the latter raises its level B) the former requires a decrease in national saving, while the latter causes an increase C) the former raises the level of R&D spending, while the latter also improves its productivity D) the former requires an increase in national saving, while the latter causes a decrease
In the long run, if government increases spending ________
A) interest rates decrease B) it crowds out private investment C) saving increases D) all of the above E) none of the above
If the demand for a good is elastic, a decrease in its price will result in additional revenue because the increase in quantity more than offsets the decrease in price
a. True b. False Indicate whether the statement is true or false