Refer to Figure 26-7. Suppose the Fed sells Treasury Bills in pursuit of contractionary monetary policy. Using the static AD-AS model in the figure above, this situation would be depicted as a movement from
A) B to C. B) C to B. C) B to D. D) C to D. E) A to B.
Ques. 2Which of the following statements about commission systems of compensation is false?
A) During sluggish periods, an employer's payroll expenses will decline along with sales.
B) If workers are paid on the basis of the number of units produced, they may become less concerned about quality.
C) They increase the risk to workers because sometimes output declines for reasons not connected to the worker's effort.
D) The lack of income stability will induce the more productive workers to leave in search of more secure employment.
Ques. 3Refer to Figure 28-2. At which point are inflation expectations equal to the actual inflation rate?
A) A B) B C) C D) all of the above
Ques. 4An increase in the real interest rate will decrease consumption and investment.
Indicate whether the statement is true or false
Ques. 5Refer to Figure 16-6. If Sensei acts as a monopolist, his profit-maximizing price is ________ and the number of classes sold is ________.
A) P1; Q1 B) P0; Q1 C) P0; Q0 D) P1; Q0
Ques. 6The PPI is the
A) production performance indicator. B) producer price index.
C) price parity index. D) prime producer index.
Ques. 7Workers and firms both expect that prices will be 3 higher next year than they are this year. As a result
A) aggregate demand will increase by 3.
B) workers will be willing to take lower wages next year.
C) the purchasing power of wages will rise if wages increase by 3.
D) the short-run aggregate supply curve will shift to the left as wages increase.
Ques. 8Refer to Figure 26-7. Suppose the Fed lowers its target for the federal funds rate. Using the static AD-AS model in the figure above, this situation would be depicted as a movement from
A) C to D. B) A to B. C) C to B. D) E to A. E) B to A.