Assume that the stock of money is determined by the Federal Reserve and does not change when the interest rate changes. This situation means that the:

Suppose you have a money income of $10 all of which you spend on Coke and popcorn. In the above diagram, the prices of Coke and popcorn respectively are:

A) $.50 and $1.00. B) $1.00 and $.50. C) $1.00 and $2.00. D) $.40 and $.50.

If both real GDP and nominal GDP of a country increased at the same rate in a particular year, which of the following is most likely to have taken place?

a. Output increased and the price level increased b. Output increased and the price level decreased c. Output decreased and the price level increased d. Output decreased and the price level decreased e. Output increased and the price level remained constant