Using typical estimates of the sacrifice ratio, how much output would likely be sacrificed to reduce inflation by 3 percent?
The typical estimate of the sacrifice ratio suggests reducing inflation by one percent requires sacrificing about 5 percent of one year's output. Therefore, reducing inflation by 3 percent would sacrifice about 15 percent of one year's output.
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Social insurance taxes are paid by wages and investment income
Indicate whether the statement is true or false
The reduction of the inflation rate is called
A) deflation. B) disinflation. C) unflation. D) reflation.
Consider the market for ride-on lawn mowers and the recent increases in the price of oil. The recent increase in the price of oil makes it more expensive to manufacture ride-on lawn mowers. An increase in the price of oil also makes it more expensive to run a ride-on mower. If the price of oil increases, the demand for ride-on mowers will ________ and the supply will ________.
A. decrease; increase B. increase; decrease C. decrease; decrease D. increase; increase
Which of the following must be true of an attorney who buys a portable computer so that she can work on trains and planes?
a. She is engaging in conspicuous consumption. b. She gets utility from working. c. She thinks the opportunity cost of her time is higher than it really is. d. She thinks the opportunity cost of her time is lower than it really is. e. She is trying to reduce the opportunity cost of traveling.