Which of the following is NOT considered investment?
A. A family builds a house in which it plans to live.
B. A car dealer stores some of this year's models for next year.
C. An individual purchases several pieces of antique furniture.
D. A firm buys a computer for word processing.
Ans: C. An individual purchases several pieces of antique furniture.
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Suppose that the consumer price index has risen from 100 to 200. From this information we can conclude that
a) each person's real income was cut in half b) consumer incomes are doubled c) the prices in an average consumer's basket have doubled d) all consumer good prices are doubled e) all prices in the economy are doubled
Both classicals and Keynesians agree that policymakers
A) can exploit the Phillips curve in the short run. B) cannot exploit the Phillips curve in the short run. C) can keep the unemployment rate permanently below the natural rate by permanently running a high rate of inflation. D) cannot keep the unemployment rate permanently below the natural rate by permanently running a high rate of inflation.