Economists use the term inflation to describe a situation in whichSelect one:O a. the economy's overall price level is rising.O b. some prices are rising faster than others.O c. the economy's overall price level is high, but not necessarily rising.O d. the economy's overall output of goods and services is rising faster than the economy's overall pricelevel.

Inflation is commen in the economy. Economic fluctuations happens in every economy.

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Economists use the term inflation to describe a situation in which Soloct

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter22: Money Growth And Inflation

Section: Chapter Questions

Problem 5PA

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Q44
n a particular economy, the price index was 120 in 2012 and 130 in 2013. Which of the following statements is correct? O a. The economy experienced a rising price level between 2012 and 2013. O b. The economy experienced a higher inflation rate between 2012 and 2013 than it had experienced between 2011 and 2012. O c. The inflation rate between 2012 and 2013 was 10 percent. Od. The base year is 2011.
Inflation is best described as: A sustained increase in the demand for goods and services. A sustained increase in output and employment over time. A sustained increase in the supply of currency. O O O A sustained increase in prices over time. A sustained increase in the price of one or two essential goods like the price of gasoline and food. Moving to the next question prevents changes to this answer. JUL 19 tv 10 MacBook Pro A
Which of the following shifts in aggregate demand and short-run aggregate supply would cause an unambiguous increase in inflation? Select one: O a. A decrease in AD and an increase in SRAS O b. No change in AD and an increase in SRAS O c. An increase in AD and an increase in SRAS d. An increase in AD and a decrease in SRAS O e. A decrease in AD and a decrease in SRAS
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Which of the following does not influence the rate of inflation? O a. The number of people affected by inflation O b. the rate of trade with other countries O c. The rate of growth in other countries O d. The rate at which prices are rising
Which of the following is a positive statement? O a. An inflation rate of 7 percent is too high. b. The unemployment rate of 7 percent or higher is a national disgrace. c. Unemployment and inflation are equally important problems. O d. Unemployment is a less important problem than inflation. e. When the national unemployment rate is 7 percent, the unemployment rate among inner-city youth is often close to 40 percent.
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Suppose there's an unanticipated increase in the rate of inflation. Which of the following is likely to be true? Select one: a. Workers whose nominal wages are set at the beginning of the year are likely to suffer a decrease in real wages. O b. Workers whose nominal wages are set at the beginning of the year are likely to enjoy an increase in real wages. The real value of outstanding loan balances of debtors will increase. O d. Creditors who made loans based on the anticipated rate of inflation will earn a higher real interest rate than they expected.
QUESTION 20 Table: The table below is for an imaginary economy of Orangeland where a typical consumer basket consists of 2 blankets and 10 coffees. Price of a Price of a Year Blanket Coffee 2017 $40 $3 2018 $45 $4 2019 $50 $5 Refer to Table. If the base year is 2018, then the economy's inflation rate in 2019 was O a. 15.38 percent. O b. 13.98 percent. Oc. 25.00 percent. O d. 20.00 percent.
Suppose that the price of bananas rises by 30%. This will have the largest impact on which measure of inflation? O A. GDP Deflator O B. Core CPI OC.CPI O D. Chained CPI Reset Selection Question 16 of 25 In 1983, the BLS chose to exclude home prices from the CPI. Why did they do this? O A. It is difficult to get home prices in a timely fashion B. Home Prices have an asset value component that doesn't reflect cost of living C. Home sizes have changed over the years making it difficult to compare home prices over time D. Home prices are too volatile in the short run Reset Selection
The nominal interest rate is 7 percent and the inflation rate is 2 percent. What is the real interest rate? O a. 5 percent O b.9 percent OC.-5 percent O d. 0.50 percent