Why do policymakers have the goal of stable prices?
a. Stables prices always keep the economy in expansion
b. Firms make too much money when prices are rising
c. Inflation is always associated with wars
d. Inflation imposes costs on society
e. Inflation is always associated with trade deficits
D
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A graph of the relationship between two variables is a line that slopes down to the right. These two variables are ________ related
A) trend-line B) negatively C) positively D) not E) directly
The largest component of total spending is
A) private investment, the capital consumption allowance. B) government spending on public goods. C) private consumption on durable and non-durable goods. D) public consumption of non-durable goods.
Homer and Marge both enjoy lasagna and wine. Homer's utility function is given by U(L,W) = 12L + 4W. Marge's utility function is given by U(L,W) = 2L + 2W. In each function, L stands for plates of lasagna and W stands for glasses of wine. Would Homer and Marge agree to a trade in which Homer gives Marge a plate of lasagna in exchange for two glasses of wine?
What will be an ideal response?
Balance of payments surpluses arise whenever the exchange rate is pegged at an artificially low level.
Answer the following statement true (T) or false (F)