Economists use the concept of ceteris paribus to examine a change in ____________ in a model, while assuming that all other variables remain constant.
Fill in the blank(s) with the appropriate word(s).
one variable
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To examine a change in one variable in a model, an economist must assume everything else is constant. This is the concept of ceteris paribus, from the Latin meaning "other things being equal."
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A. inflation.
B. deflation.
C. a greater level of potential output.
D. a lower level of potential output.
To decrease the money supply, the Fed would
What will be an ideal response?
The “War on Poverty” was declared by President Ronald Reagan in 1982.
Answer the following statement true (T) or false (F)
According to the Taylor rule, the Federal Reserve ________ the real interest rate as the output gap increases and ________ the real interest rate as the inflation rate increases.
A. lowers; raises B. raises; raises C. lowers; lowers D. raises; lowers