In 2000, you could buy a Cadillac DTS for $45,000. In 2011, the Cadillac DTS sold for $55,000
While both models include anti-lock brakes and air bags (along with other similar features), the 2011 model also includes satellite radio and new technology that provides improved gas mileage and safer driving. If the Cadillac DTS was included in the CPI basket, it would create A) a downward bias in the inflation rate.
B) an upward bias in the CPI as a result of quality change bias.
C) an upward bias in the CPI as a result of commodity substitution bias.
D) a downward bias in the CPI as a result of new goods bias.
B
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Which of the following would cause the long-run aggregate supply curve to shift to the right?
A) an increase in wages B) an increase in demand C) an increase in productivity D) an increase in taxes on profits
The public debt is the:
A. Amount of U.S. paper currency in circulation B. Ratio of all past deficits to all past surpluses C. Accumulation of all past deficits minus all past surpluses D. Difference between current government expenditures and current tax revenues