If country X has a higher capital per person than country Y, then ________
A) country X is richer than country Y
B) the only way for country X to be richer than country Y is if X is just as productive (has the same TFP) as Y
C) the only way for country Y to be richer than country X is if Y is more productive (has a higher TFP) than X
D) the only way for country X to be richer than country Y is if X is less productive (has a lower TFP) than Y
E) none of the above
C
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The marginal propensity to consume plus the marginal propensity to save must always equal 1
a. True b. False Indicate whether the statement is true or false
In the long run, a sustained increase in money supply growth relative to the growth rate of potential real output will most likely: a. cause the nominal interest rate to fall
b. cause the real interest rate to fall. c. reduce the natural rate of unemployment. d. none of the above