Economic stagnation coupled with high inflation is commonly called:
A. stagflation.
B. inflationary stagnation.
C. stagnatory growth.
D. inflagnation.
Answer: A
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The measurement system used by the U.S. government to estimate national income is
A) the sum of financial transactions, transfer payments and secondhand goods. B) the sum of consumption plus investment expenditures. C) national income accounting. D) the GDP deflator.
Explain how exchange rates affect the level of aggregate economic activity and the price level. Use appropriate AS/AD diagrams to illustrate your answer.
What will be an ideal response?
During the recent past, production and income have grown faster than population in highly developed economies because
A. of the availability of expensive and ineffective birth control devices. B. of rapid technological advancements. C. accumulation of both physical and human capital has slowed down. D. famine, war, and pestilence have greatly reduced the population.
Suppose workers and employers agree to a three-year wage contract under the expectation of 3 percent inflation, but inflation turns out to be 1 percent. In this case, ________ lost purchasing power, and ________ gained purchasing power.
A. no one; employers B. workers; employers C. employers; workers D. employers; no one