A reduction in the inflation rate would make relative prices a. less variable, making it more likely that resources will be allocated to their best use. b. less variable, making it less likely that resources will be allocated to their best use. c. more variable, making it more likely that resources will be allocated to their best use. d. more variable, making it less likely that resources will be allocated to their best use.

Is it possible for there to be inflation present in the economy and still witness a decline in a large number of goods? If so, how and why is this possible?

Suppose that an increase in the cost of resources increases the cost of production for the U.S. economy. If the Federal Government chooses to combat inflation, which of the following would be the best course of action?Group of answer choices 1 Increase expenditure taxes. 2 None of the answers are actions that it would take. 3 Do nothing. 4 Decrease income taxes.

A country has 4 million units of goods and services within itself. While these goods and services remain constant, the government printed money and increased the amount of money in circulation from 10 million units to 12 million units. Under these conditions: a) Calculate the amount of increase in prices. b) Calculate the rate of decrease in the purchasing power of money

What is the effect of an increase in the price level when the money wage rate remains​ unchanged?     A. Aggregate supply increases.   B. Potential GDP increases.   C. The quantity of real GDP supplied increases.   D. Resource prices increase by the same percentage as the increase in the price level.

Question 2: Use the above graph to show the following how L* would change A. The price of the final good increases B. The wages increase C. During a period of inflation all prices and wages double

A government is trying to reduce inflation but this has led to higher unemployment. Explain the role of the prices stickiness in causing this tradeoffs?

Which of the following, if true, would illustrate why price indexes such as the CSPI might overstate inflation in the cost of going to college? Check all that apply. Professors required each student to buy 10 textbooks, regardless of the price. As the price of textbooks increased, more and more students turned to the used-book market or chose not to buy textbooks at all, instead using the copies on reserve in the library. A new, safe method of memory enhancement became available for purchase. The quality and design of calculators improved dramatically from 2017 to 2019. For example, calculators made in 2019 accept memory cards, whereas those made in 2017 do not, but this quality change is hard to measure.

The country of Econoland produces two goods: textbooks and widgets. Last year produced 200 textbooks and 500 widgets. This year it produced 250 textbooks and 600 widgets. Given no other information which of the following could not explain the change?  A) Econo land experienced an improvement in widget making technology B) none of these answers are correct based on the question C) Econo land experienced a reduction in unemployment Can you help me understand this more

Inflation is an economic problem because it leads inevitably to unemployment. O leads to recession. makes prices less useful as signals for resource allocation. results in rapid increases in the money supply.