a government is facing high inflation, then it will take an action as following:   I. increase taxes, increase discount rate   II. decrease taxes, decrease discount rate   III. increase taxes, decrease discount rate   IV. decrease taxes, increase discount rate

Q: What is the average inflation rate?

A: The rise in the price of services and commodities over time is said as inflation.

Q: If the government wanted to reduce inflation in the economy, it could: a. Increase income transfers…

A: Fiscal policy refers to changes in government spending, taxes and transfers. It is imposed by the…

Q: If the inflation rate turns out to be less than was is expected to be, the clear winners are…

A: A higher than expected inflation is an indicator that money repaid by the borrower on the loan will…

Q: The government of the United States is worried that the inflation rate is too high. What fiscal…

A: Option D To reduce the inflation rate, the government has to undertake steps to reduce the level of…

Q: 14. Which of these government actions is designed to lower inflation? E. hiring more government…

A: Inflation is the general rise in the prices of all goods and services which leads to decrease in…

Q: n 2020, interest rates were 9.2% and the rate of inflation was 11%. What was the real interest rate…

A: Nominal Interest Rate=9.2% Rate of Inflation=11% Real Rate of Interest = Nominal Interest - Rate of…

Q: f inflation is 4 percent per year and you receive a 3 percent raise in income, t

A: Inflation  4% Income rises by 3%

Q: Inflation a.What is inflation and how is it calculated? List and explain the two types of inflation…

A: a) The constant rise in prices in an economy over a period of time is called inflation. It is…

Q: Fearing a recession, the government decides to give citizens a tax rebate to buy Christmas gifts.…

A: The government makes a decision according to the current market situation and future expectations.…

Q: What are the two types of inflation and how are they different?

A: The 2 types of inflation normally mentioned are demand-pull inflation and value-push inflation.…

Q: Describe inflation, explain how it happens and describe its effect on purchasing power?

A: The money which has to be paid for obtaining a service or a good is the price.

Q: The nominal interest rate is 10​%. The inflation rate is 2​%.   The real interest rate is equal to

A: An economic formula that describes the one-to-one relationship between nominal interest rates (i),…

Q: The higher the expected rate of inflation, A) the lower is the nominal rate of interest.…

A: The term "expected rate of inflation" describes the anticipated rise in the average price of goods…

Q: Which statement best describes U.S. inflation between 1982 and 2000?   A. It was virtually…

A: This question invites an exploration of the historical trends in U.S. inflation over a specific…

Q: Put the following terms into a meaningful equation and then explain in words why this relationship…

A: Real Interest rate (r): The real interest rate represents the actual return on an investment or the…

Q: The real interest rate is the percentage of the amount borrowed that must be paid to the lender in…

A: Macroeconomic monitoring will remain crucial since it determines the economy's long-term growth…

Q: The economy starts out at full-employment equilibrium. Some events then occur that generate…

A: Cost push inflation can be defined as inflation which occurs due to rise in input costs like rise in…

Q: Whether you gain or lose during a period of inflation depends on: a) how the price increases affect…

A: During the period of inflation, the general price level will continuosly rising.

Q: A person who is lending money o S or B A person receiving a fixed income S or B A person with money…

A: High inflation makes some people worse off and some people better off.