If there are only two goods in the economy, one whose price rises by 1 percent and one by 6 percent, it is possible that inflation is:
A. 6 percent.
B. 1 percent.
C. 2 percent.
D. 7 percent.
Answer: C
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A movement along a demand curve is most likely to be caused by
A) a change in the population. B) a change in expectations. C) a change in income. D) a change in the price of a good.
Government expenditures on housing subsidies at all levels total more than $45 billion a year
a. True b. False
The backward-bending portion of the labor supply curve indicates that as the wage rate rises,
a. the substitution effect dominates the income effect of the higher wage. b. the number of hours worked increases. c. the income effect dominates the substitution effect of the higher wage. d. the income effect reinforces the substitution effect of the higher wage.
If the government decides to build highly subsidized dorms for all college students, then we will see
a. an upward movement along the AD curve b. a downward movement along the AD curve c. the AD curve shift to the left d. the AD curve shift to the right e. the AS curve shift to the right