During periods of inflation, the real value of a given amount of nominal dollars decreases
a. True
b. False
Indicate whether the statement is true or false
True
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Suppose we observe people buying more of a good even though its price has risen. What would an economist conclude?
A) Impossible! We will never observe prices and quantity simultaneously rising in the real world. B) The demand curve for the good must be upward-sloping. C) The law of demand doesn't hold. D) The demand curve has shifted to the right. E) Consumption increasing as prices increase only occurs when a good is needed for survival.
Which of the following is the most important protection against fears of bank collapse?
a. The Federal Reserve. b. The Federal Reserve Open Market Committee. c. The Federal Deposit Insurance Corporation. d. The gold and silver that backs Federal Reserve notes.