Other things equal, when the supply of workers is low, one would predict that market wages would be
a. relatively high.
b. relatively low.
c. determined solely by factors that affect demand.
d. determined outside the domain of economic theory.
a
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In the long run, the Fed may decrease the unemployment rate only if it is willing to increase the rate of inflation
Indicate whether the statement is true or false
Suppose that over the past year, the real interest rate was 3 percent and the inflation rate was 1 percent. It follows that
a. the dollar value of savings increased at 2 percent, and the purchasing power of savings increased at 3 percent. b. the dollar value of savings increased at 2 percent, and the purchasing power of savings increased at 4 percent. c. the dollar value of savings increased at 4 percent, and the purchasing power of savings increased at 2 percent. d. the dollar value of savings increased at 4 percent, and the purchasing power of savings increased at 3 percent.