Critically evaluate the statement "Honolulu is an expensive place to live. Therefore the inflation rate must be high in Honolulu."
What will be an ideal response?
The statement confuses the price level with the inflation rate. Inflation is a flow variable—it measures changes in prices from year to year, while the price level is a stock variable. The statement observes the price level, not the inflation rate.
Economics
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In relation to the corporation, its bondholders are
a. borrowers b. lenders c. customers d. managers e. owners
Economics
The total burden of a tax is the
a. absolute number of dollars an individual pays. b. percentage of income a person pays. c. number of dollars a person must be given after taxation to make him as well off as he was before taxation. d. revenue lost to loopholes.
Economics