In a demand-pull inflation, if the Fed stops expanding the quantity of money,
A) a cost-push inflation will occur.
B) government expenditure will cause the demand-pull inflation to continue.
C) a deflation will occur.
D) the demand-pull inflation ends.
E) None of the above answers is correct.
D
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If the price of a good increases from $3 to $4, and the quantity demand remains unchanged, then the demand is
A) perfectly inelastic. B) perfectly elastic. C) somewhat elastic. D) infinite.
The observation that countries with high rates of population growth don't have higher per capita income ________
A) suggests that the Solow model is unrealistic B) implies that technology doesn't work as well in countries where the population is growing rapidly C) is not supported by most empirical studies D) is consistent with the Romer model as applied to the world as a whole