In which of the following cases would there be an effect on the value of the U.S. consumer price index, but not on the value of the U.S. GDP deflator?
a. All of the truck tires that are produced by a certain company in South Korea are sold to the U.S. military, and the price of these tires decreases.
b. All of the truck tires that are produced by a certain company in California are sold to the U.S. military, and the price of these tires decreases.
c. Most of the bananas that are produced by a certain company in Honduras end up in U.S. grocery stores, and the price of these bananas increases.
d. Most of the earth-moving machines that are produced by a certain company in Illinois are exported to other countries, and the price of these machines increases.
c
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Refer to Figure 19-6. Which of the following would cause the change depicted in the figure above?
A) Dumping accusations result in the United States placing tariffs on produce imported from Mexico. B) An increase in investment in infrastructure causes U.S. productivity to rise relative to Mexican productivity. C) A declining preference for Kentucky bourbon causes Mexican consumers to decrease their preferences for U.S.-produced alcohol relative to Mexican-produced alcohol. D) A contractionary monetary policy causes a decrease in the price level of U.S. goods relative to Mexican goods.
Which of these government financing methods is generally the least inflationary?
A) Printing currency B) Borrowing from the banking system C) Borrowing from the central bank D) Borrowing from the non-bank public