If the cross elasticity of demand between goods X and Y is positive and between goods X and Z is negative, then X and Y are ________ and X and Z are ________

Which of the following correctly describes the relationship between productivity growth, unemployment, and the economy's production possibilities frontier?

A) An increase in productivity moves the economy from inside the production possibilities set to its frontier. B) An increase in productivity shifts the economy from the production possibilities frontier to a point outside the production possibilities set. C) An increase in unemployment shifts the economy further inside its production possibilities set. D) An increase in unemployment shifts the economy from a point outside the production set back to the production possibilities frontier. E) A reduction in unemployment shifts the entire production possibilities frontier outward.

People know that the inflation rate will decrease from 7 percent to 3 percent. As a result

A) the nominal interest rate falls by 4 percentage points. B) the nominal interest rate is constant. C) the nominal interest rate rises by 4 percentage points. D) the nominal interest rate equals 3 percent.