Economists use the term inflation to describe a situation in which the economy's overall production level is rising
a. True
b. False
Indicate whether the statement is true or false
False
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According to the information, Japan's real GDP per person
A) is higher than Brazil's and therefore we can definitely conclude that economic well-being is higher in Japan. B) is $33,000. C) is lower than Brazil's, but its real GDP is higher which makes standard of living higher in Japan. D) cannot be expected to change much given the other factors affecting GDP growth including political freedom and life expectancy.
The corporate tax applies to firms’ total revenues.
Answer the following statement true (T) or false (F)
In terms of the Phillips curve, the experience of the 1970s indicates that macro-policy
a. can permanently reduce unemployment if we are willing to tolerate higher inflation. b. can reduce unemployment in the long run if we are willing to tolerate higher inflation. c. may be able to reduce unemployment but cannot retard inflation. d. may be able to reduce unemployment in the short run, but there is little evidence that expansionary policies can reduce unemployment permanently.
Starting from long-run equilibrium, a large increase in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; potential B. recessionary; higher; potential C. recessionary; lower; lower D. expansionary; higher; higher