1.The definition of a hyperinflation is having an inflation rate of 50 percent a
ID: 1239224 • Letter: 1
Question
1.The definition of a hyperinflation is having an inflation rate of 50 percent a year (or more).Ture or False
2.Suppose that union leaders negotiate a significant increase in nominal wages. If the Federal Reserve holds the growth in the money supply constant, in the long run, unemployment
Select one:
a. remains constant while prices increase.
b. remains constant will prices decrease.
c. and prices both remain constant.
d. decreases while prices increase.
3.According to the rational expectations theory
Select one:
a. the public makes consistent errors when forming expectations.
b. only central bankers form expectations rationally.
c. the public, on average, anticipates the future correctly.
d. the public only uses a portion of the available information when forming expectations.
4.If the velocity of money is 2 and nominal GDP is $10 trillion, then the money supply is
Select one:
a. $0.2 trillion.
b. $5 trillion.
c. $8 trillion.
d. $12 trillion.
5.Rapid inflation results when governments print money to finance large portions of their budget deficits.
Select one:
True
False
Explanation / Answer
1=t 2=c 3=b 4=d 5=f
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