Question

Which of the following is a problem that an hyperinflation tends to create?
Select one:
a. The government has to keep printing money to keep up with the rising prices
b. All of these are problems that a hyperinflation tends to create
c. The country has a hard time exporting products because their prices keeps increasing
d. People have to rush to the store to purchase products before their prices increases
e. Banks losing money because the real return on their loans falls

Question 15

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Which one of these is NOT an example of an automatic stabilizer?
Select one:
a. Interest rates tend to fall during recessions
b. People pay more income tax when the economy is growing and their income rise
c. The government typically increases spending on highways during expansions
d. Wages tend to fall when unemployment is high
e. Unemployment compensation tend to rise during recessions

Question 16

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If there is a contractionary gap in the economy, which of the following is MOST likely to be true?
Select one:
a. Employment is above the full level of employment
b. Unemployment is below the natural rate of unemployment
c. The economy is in long-term equilibrium
d. Real GDP is above Potential GDP
e. Unemployment is relatively high