An inflationary gap can be closed with
A) using an expansionary monetary policy.
B) using a policy action such as a reduction in taxes.
C) using a policy action such as a reduction in government purchases.
D) imposing price controls to prevent prices from rising.
Ans: C) using a policy action such as a reduction in government purchases.
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Which of the following statements is correct?
a. As a group, economists see no purpose in distinguishing between the nominal interest rate and the real interest rate. b. The interest rate that is usually reported is the nominal interest rate. c. If the nominal interest rate increases and the inflation rate remains unchanged, then the real interest rate decreases. d. All of the above are correct.
Refer to the below table. What is the marginal revenue product if the firm employs the 12th worker?
A. $19.50
B. $26.50
C. $42.50
D. $47.50