The long-run cumulative dynamic multiplier
A) cannot be calculated since in the long-run, we are all dead.
B) is the sum of all individual dynamic multipliers.
C) is the coefficient on Xt-r in the standard formulation of the distributed lag model.
D) is the difference between the coefficient on Xt-1 and Xt-r.
Answer: B
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To measure the "core" inflation rate, the Bureau of Economic Analysis uses a price measure that
A. excludes food and energy prices because the prices of these items can be volatile. B. includes food and energy prices because the se items account for a significant portion of the typical consumer's expenditures. C. is made up of a fixed basket that includes durable goods, non-durable goods, and services. D. includes prices for different components of gross private domestic investment, government spending, and personal consumption expenditures.
What is the law of diminishing marginal utility?
What will be an ideal response?