A payment is said to be indexed if it is automatically adjusted for inflation.
Select whether the statement is true or false.
A. True
B. False
A. True
This statement is true. A payment is said to be indexed if it is automatically adjusted for inflation.
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In an open economy with fixed exchange rates, monetary policy is most effective at increasing real income if
A) capital mobility is high. B) capital mobility is low. C) capital mobility is perfect. D) monetary policy is ineffective with fixed exchange rates.
Over the past year, an economy's labor supply increased from 100 to 102, its capital stock increased from 1000 to 1030, and its output increased from 500 to 525. All measurements are in real terms
Calculate the contributions to economic growth of growth in capital, labor, and productivity if aK = 0.2 and aN = 0.8.
Evidence from the Great Recession suggests that the crowding out effect:
A. had a very detrimental effect on private savings. B. was minimal at that time. C. can be quite large in times of recession, and is reinforced with recent research from 2008. D. may hold, although the evidence is somewhat contradictory.
Inflation is best defined as
A. a sustained increase in the price of ALL goods and services in an economy. B. a sustained increase in the average of all prices of goods and services in an economy. C. a sustained increase in the price of a single good or service. D. a relative price increase.