Traditional Keynesians argued that when wages are rigid, changes in output result in:
a. small changes in goods market prices and a flat aggregate supply curve.
b. large changes in goods market prices and a flat aggregate supply curve.
c. large changes in goods market prices and a steep aggregate supply curve.
d. small changes in goods market prices and a steep aggregate demand curve.
e. small changes in goods market prices and a horizontal aggregate demand curve.
a
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If the U.S. interest rate is 5% and the interest rate in Germany is 2%, and the euro is expected to appreciate by 2% over the next year, then investors would:
a. sell dollars in the spot market. b. buy euros. c. seek to invest in the United States. d. seek to invest in Germany.
The core inflation rate measures changes in the
A) prices of consumer goods except health care. B) prices of all consumer goods. C) prices of consumer goods except food and fuel. D) price of only two consumer goods: food and fuel. E) prices of all the "core" goods and services a typical family buys.