To compare the purchasing power of nominal wages in two different years, one must:
A. deflate both quantities by a common price index.
B. adjust both quantities by the real interest rate.
C. increase both quantities by the same percentage increase in a price index.
D. compare the nominal values.
Answer: A
Economics
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When the exchange rate appreciates in the short run and then depreciates to its original level in the long run, it implies that the foreign money supply has:
a. temporarily risen. b. permanently risen. c. temporarily fallen. d. permanently fallen.
Economics
If the reserve ratio is 0.9, the money multiplier will be 10.
Answer the following statement true (T) or false (F)
Economics