Explain how it is possible for a recently retired postal worker to be more wealthy than a rookie professional football player even though it is widely recognized that football players earn more than postal workers
What will be an ideal response?
The reason is that the postal worker in all likelihood has been spending years or decades building up wealth from his income. A rookie professional football player however, may earn a higher wage but has not had the opportunity to build up much if any wealth at all since his career has just begun.
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Adaptive expectations are "__________" according to the New Classical economists because they __________ information it is possible to use in making a forecast
A) rational; include all B) rational; exclude some C) irrational; include all D) irrational; exclude some
Real wages will rise if
A) money supply growth is less than expectations. B) real interest rates fall. C) aggregate demand is less than aggregate supply. D) money supply growth exceeds the inflation rate.