Öne reason that inflation can persist even after its original causes have been removed is that... a. Workers expect wage increases to match increases in labour productivity. O b. Workers are willing to accept wage increases lower than the increase in productivity. O c. Governments embark on a deficit-cutting programme. O d. Inflationary expectations cause the AS curve to continue shifting upwards. O e. The Bank of Canada ensures that money-supply growth matches growth in real GDP.

Öne reason that inflation can persist even after its original causes have been removed is that... a. Workers expect wage increases to match increases in labour productivity. O b. Workers are willing to accept wage increases lower than the increase in productivity. O c. Governments embark on a deficit-cutting programme. O d. Inflationary expectations cause the AS curve to continue shifting upwards. O e. The Bank of Canada ensures that money-supply growth matches growth in real GDP.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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4) If actual inflation is more than expected inflation, which of the following groups will most certainly benefit? а. Lenders b. Borrowers с. Minorities d. Women е. Men Suppose that the consumer price index of a country was 160 at year-end 2004 and 168 at the 5) end of 2005. What was the country's inflation rate during 2005? 5 percent b. а. 8 percent 60 percent d. с. 68 percent 6) If the consumer price index (CPI) at the end of year one was 100 and was 108 at the end of year two, the inflation rate during year two was zero; the CPI of 100 indicates that prices were stable. b. а. 8 percent. 5 percent. d. c. 108 percent.
Consider the short run and the long run and then choose the statement that is correct. O A. The real interest rate is independent of the inflation rate in the long run. B. The real interest rate is dependent on the price level in the long run. C. In the short run, money market equilibrium determines the price level. D. In the short run, other things remaining the same, a given percentage change in the quantity of money brings an equal percentage change in the price level.
In a monetary economy with flexible prices, a temporary contraction of the quantity of money will cause Select one: O a. An increase in the nominal interest rate O b. O c. A proportional fall in the price level More inflation in the future, unless it is accompanied by fiscal adjustment O d. two of the other
Refer to the information provided in the figure at right to answer the question that follows. The level of aggregate output that can be sustained in the long run without inflation O A. is $400 million. B. is $700 million. O C. is $800 million. O D. cannot be determined from this information because aggregate demand is not given. Price level, P LRAS AS :800 400 700 Aggregate output (income), Y ($ million)
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To achieve long term economic growth.....O a. Money is neutralO b. All answers are correctOC. Money and inflation are neutralO d. Money is not neutral
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Five O Otner Bo Inflation VPC 4. 3 1. ye Output Figure 2 The Vertical Phillips Curve Figure 2 represents an economy in which the target rate of inflation is 3%. In the absence of any policy intervention, which one of the following statements correctly describes the future direction of inflation in the economy if it is at point Z on the diagram. Select one: O Inflation will rise further away from its target level. O Inflation will not change. O Inflation will rise towards its target level. O Inflation will fall further away from its target level. O Inflation will fall towards its target level. MacBook 00 DD 000 F4 F5 F6 F7 F8 F9 F10 云

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ASAP
The long-run Phillips curve is vertical because it is O a. consistent with the conclusion of Friedman and Phelps, but it is not consistent with the classical idea of monetary neutrality. Ob. consistent with the classical idea of monetary neutrality, but it is not consistent with the conclusion of Friedman and Phelps. Oc. consistent with both the conclusion of Friedman and Phelps and the classical idea of monetary neutrality. Od. consistent with neither the conclusion of Friedman and Phelps nor the classical idea of monetary neutrality. QUESTION 41 If there is a favorable supply shock, inflation will O a. increase and shift the short-run Phillips curve left. Ob. decrease and shift the short-run Phillips curve right. Oc. increase and shift the short-run Phillips curve right. Od. decrease and shift the short-run Phillips curve left. QUESTION 42 If there is a favorable supply shock causes, then O a. the price level decreases. To counter this a central bank would decrease the money supply.…
Consider an increase in government spending. Assume that the economy is initially operating at the natural level of output. In the short run, the impact on the IS-LM framework is This change results in In the medium run, the no output gap a negative output gap The resulting medium- a positive output gap his change is OYrn and current period's inflation is less than target inflation OY > Yn, r = rn and current period's inflation is greater than target inflation OY = Yn, r = rn and current period's inflation equals target inflation OY> Yn, r