If expectations are rational,
a. a predictable change in inflation can make the expected inflation rate deviate from the actual rate.
b. unemployment can exceed the full-employment rate even in the long run.
c. the difference between the actual inflation rate and the expected inflation rate must be a purely random number.
d. the inflation rate cannot be reduced without a period of high unemployment because the Phillips curve is downward sloping.
c
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If the Mexican peso (MXN) to Brazilian real (BRL) exchange rate goes from 5.9 MXN/BRL to 7.2 MXN/BRL
A) Brazilians decrease their demand for Mexican goods. B) Brazilians increase their demand for Mexican goods. C) Mexicans increase their demand for Brazilian goods. D) Not enough information to determine what happens.
A doubling of income will result in a doubling of autonomous investment
Indicate whether the statement is true or false