Suppose an economy experiences a permanent increase in its expected inflation rate. As a result, there is
A) a downward shift of the short-run Phillips curve.
B) a downward movement along the short-run Phillips curve.
C) an upward movement along the short-run Phillips curve.
D) no change at all to the short-run Phillips curve.
E) an upward shift of the short-run Phillips curve.
E
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Refer to the budget line shown in the diagram above. Given the same money income, reductions in the prices of both products C and D will:
A) shift the budget line outward on the horizontal axis, but leave it anchored at "10" on the vertical axis. B) shift the budget line to the left. C) shift the budget line to the right. D) have no effect on the budget line.
If a bond was to pay off one year from now for $630 and was purchased for $600, what is the interest rate?
A) 3 percent B) 5 percent C) 15 percent D) 30 percent