A depreciation of the dollar will cause an increase in the Consumer Price Index.

In an oligopoly, firms can increase their market power by

A) undertaking heavy advertising expenditure. B) colluding to set prices. C) selling to buyers who have market power. D) pursuing dominant strategies.

The new Keynesians believe that the economy is not always in equilibrium because:

a. of the existence of voluntary unemployment. b. the Federal Reserve policy is too restrictive. c. government intervention destabilizes the economy. d. of the existence of wage and price rigidities. e. the rate of inflation is too high.