According to New Keynesians, which of the following is one of the two key factors that determines the inflation rate?

When a firm or economy is operating efficiently, it is operating

a. outside its production possibilities frontier. b. inside its production possibilities frontier. c. on its production possibilities frontier. d. at the intersection of the production possibilities frontier and the vertical axis. e. at the intersection of the production possibilities frontier and the horizontal axis.

Gross private domestic investment includes business:

A. purchases of capital goods, all new construction, and purchases of consumer durable goods. B. purchases of capital goods, all new construction, and inventory investment. C. purchases of capital goods, all new commercial construction, and inventory investment. D. purchases of all types of durable goods, all new construction, and inventory investment.