When actual output equals potential output and the inflation rate is stable, the economy is said to be in ________ equilibrium.

Which of the following would NOT be directly included in the U.S. GDP in 2010?

A) the purchase of a new home in Atlanta, Georgia in 2010 B) the market value of the jet fuel bought by Delta to use for its flights in 2010 C) the market value of restaurant meals sold in 2010 D) the value of the automobiles produced in 2010 at the Toyota plant located in Georgetown, Kentucky E) legal services provided to first time home buyers during 2010

Regarding government manipulation of the interest rate, all of these statements are correct, except: a. To address business fluctuations, governments may reduce interest rates to induce people to borrow

b. Such manipulations may give little thought to the effects on resource allocation between present and future. c. Economists agree with the concept of using of interest rates to allocate resources among different time periods. d. Generally, the price system reflects public preference between present and future resource allocation.