People in an open economy who wish to invest can either:
A. invest at home or abroad.
B. buy stocks or bonds.
C. buy financial assets or durable goods.
D. invest in private companies or public companies.
A. invest at home or abroad.
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Suppose velocity does not change. Then, in the long run, a growth rate of the quantity of money that exceeds growth in real GDP has what effect?
What will be an ideal response?
Incorporation of expectations into economic decision making and the economic experience of recent decades indicate that in the long run
a. inflation relates directly to unemployment. b. inflation is inversely related to unemployment. c. there is no trade-off between inflation and unemployment. d. high unemployment is a primary cause of inflation.
An editorial in the paper argues that a person only should be allowed to attend school if the marginal cost of educating that person is less than the marginal benefit of educating that person. The writer's reasoning is an application of:
A. positive economics. B. normative economics. C. negative economics. D. economic naturalism.
Which of the following examples, ceteris paribus, would most likely cause rightward movement of the short-run aggregate supply curve for that economy?
a. The price level in Norway increases over several years. b. Production costs increase in Mexico due to increased government regulation. c. Deflation in the United States pushes down the price level. d. Labor productivity declines in Canada after nominal wages also decline.