An economy experiences economic growth whenever
A. Long-run real GDP rises.
B. The unemployment rate falls.
C. Nominal GDP rises.
D. Base-year GDP rises.
Answer: A
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Georgine buys more sweaters when her income increases. For Georgine, sweaters are
A) a substitute. B) a complement. C) an inferior good. D) a normal good.
The expected real interest rate (re) in terms of the nominal interest rate (R) and the expected inflation rate (?e) is given by
A) re = ?e + R. B) re = 2?e + R2. C) re = ?e + R2. D) re = R - ?e. E) re = R2 - ?e.
The years from 1945 to 1973 are notable for ________
A) a Great Moderation B) generally low inflation C) brief, but severe, recessions D) all of the above E) none of the above
The index that measures the change in price of a typical basket of consumer goods is
a. the GDP deflator. b. the consumer price index. c. nominal GDP. d. real GDP.