Brief Principles of Macroeconomics (MindTap Course List)
Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN: 9781337091985
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Chapter 18, Problem 4CQQ
To determine

Why theargument is not related to maintaining positive inflation rate.

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Which of the following is most likely to be true if the rate of inflation rises sharply? a. Businesses will be able to manage rising costs b. Businesses will not be able to manage rising costs c. Businesses are less likely to raise selling prices d. Businesses can reduce selling prices
Which of the following statements about inflation is​ true?   A. Inflation is not a problem because it is just another way for the government to collect revenue—an alternative to the income tax or the sales tax.   B. Inflation is a tax on holding money.   C. Inflation occurs when real GDP grows more rapidly than the quantity of money.   D. Inflation is a tax on spending money.
Suppose that Lauren is a savvy investor and expects inflation to equal 7 per cent in 2020, but, in fact, prices rise by only 4 per cent. How would this unexpectedly low inflation rate affect her in the following circumstances?   a The federal government cuts income tax. b She has a fixed-rate mortgage home loan. c She is a casual worker with no labour contract in place. d She has invested in Treasury bonds.
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