Real income can be determined by:
A. dividing the price level by nominal income.
B. inflating nominal income for inflation.
C. dividing the annual rate of inflation into the number "70."
D. deflating nominal income for inflation.
D. deflating nominal income for inflation.
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Economists exclude many interesting economic structures and activities from their models. What they focus on is
a. the real world as they see it b. comparisons between the real world and their models c. understanding how their models work and the outcomes they generate d. the relationship between the physical economic reality and money e. the production of real goods and how they are traded
If an economist finds that when consumer incomes increase, consumers buy more cars, Ceteris paribus, then
A. the price of cars must be decreasing. B. all other things remain constant. C. the price of gas must be decreasing. D. the interest rate on car loans must be decreasing.