The prices of most services have risen much faster than inflation in recent years because
A. wages and salaries of service providers have risen much faster than inflation.
B. wages and salaries of service providers have risen, but their productivity has not.
C. the productivity of service providers has risen dramatically.
D. the demand for services has risen.
Answer: B
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Which of the following is an example of foreign portfolio investment?
A) the purchase of a U.S. mutual fund by a U.S. citizen B) the purchase of a Japanese factory by a Korean citizen C) the purchase of a U.S. stock by a U.S. citizen D) the purchase of a U.S. Treasury bond by a German citizen
Suppose the economy is initially experiencing a short-run recessionary gap. An increase in the size of the budget deficit will
A) increase the size of the recessionary gap. B) reduce the size of the recessionary gap. C) lead to an increase in prices with no increase in real GDP. D) lead to a decrease in prices with an increase in real GDP.