In order to convert nominal gross domestic product (GDP) to real gross domestic product (GDP), we must divide:
a. real GDP by the price index
b. nominal GDP by the price index.
c. the price index by nominal GDP.
d. the price index by real GDP.
e. nominal GDP by 100.
b
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Market income in the United States is distributed
A) more unequally than income after taxes and benefits. B) less unequally than income after taxes and benefits. C) the same as income after taxes and benefits. D) according to a big tradeoff between equity and equality
The argument advanced by Milton Friedman for adopting a monetary growth rule is that
A) active monetary policy potentially destabilizes the economy. B) a constant rate of growth in the money supply would eliminate the booms and recessions that make up the business cycle. C) the growth rate of M1 has been unstable. D) the Fed can control the money supply, but not the level of interest rates.