Suppose this is the base year and there are only two goods (Good A and Good B) and the average person buys 8 of Good A in a year and 6 of Good B. If the Price of Good A is $8 and the Price of Good B is $6, the price index
A. is 50.
B. is 36.
C. is 100.
D. is 64.
Answer: C
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When there is extremely high and volatile inflation in an economy, the decision-making of firms leads to a very ________ SAS curve and thus relatively ________ cycles in real GDP
A) steep, mild B) steep, violent C) flat, mild D) flat, violent
Assume all banks in the system started have a 10 percent required reserve ratio and the Fed made a $20,000 open market purchase. The result would be a(n):
A. $200,000 expansion of the money supply. B. $20,000 expansion of the money supply. C. $20,000 contraction of the money supply. D. infinite contraction of the money supply.
Figure 33-7
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In Figure 33-7, the only sustainable long-run equilibrium position is at point
A. A. B. B. C. C. D. D.
Use the following formula to answer the indicated question: Welfare benefit = Maximum benefit - Wages Suppose Parker works 2,000 hours per year at a wage of $12 per hour. If the state maximum welfare benefit is $14,000 per year, based on the welfare formula given, Parker's welfare benefit will be
A. Zero. B. $14,000. C. $7,000. D. $28,000.