Consider two economies: A and B. If the gap between the growth rate of money supply and growth rate of real GDP is larger in country A than in country B, then according to the quantity theory of money:
A) the inflation rate will be lower in country A.
B) the inflation rate will be higher in country A.
C) real interest rates will be higher in country A.
D) nominal interest rates will be lower in country A.
B
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Assume that Country X and Country Y are trading partners and the exchange rates are fixed. If prices in Country Y rise, all of the following are expected to happen except
a. Country X will export more. b. Country Y will import more. c. Net exports will rise for Country X. d. Trade will boost Country Y GDP.
Which of the following is accurate regarding income statistics?
a. Current annual income is also an accurate indicator of relative economic status for the same individual over a longer period such as a decade or lifetime. b. When there is substantial income mobility, one's current position in the income distribution will not be a very good indicator as to what one's position will be a few years in the future. c. Recent studies indicate that there is a strong positive relationship between the relative income position of a family and the relative income position of their children and grandchildren. d. Even though annual income data camouflage the fact, high-income earners generally maintain their status year after year, while those with low current incomes tend to stay poor year after year.