If this year's price level is 147 and last year's price level was 140, the inflation rate is ______________________.

1.05 percent a year
0.95 percent a year
4.8 percent a year
5 percent a year

When the GDP deflator increases from 120 to 126 in one year, _____________________.

you can purchase more with each dollar
you would anticipate a one-time rise in the price level
money is losing its value
in the following year the GDP deflator will be 132

The figure shows the aggregate demand, short-run aggregate supply, and long-run aggregate supply curves for the economy of Tomorrowland. The economy is currently at point a. A demand-pull rise in the price level will initially move the economy to point ______________ and to point __________________.

e when aggregate demand increases; d when the money wage rate rises
b when aggregate demand decreases; c when the money wage rate rises
e; a when aggregate demand changes
c when the money wage rate rises; d when aggregate demand increases

The figure shows the aggregate demand, short-run aggregate supply, and long-run aggregate supply curves for the economy of Tomorrowland. The economy is currently at point a. A cost-push rise in the price level will initially move the economy to point _______________ and to point ____________________.

b when aggregate demand decreases; c when the money price of raw materials rises
c when the money price of raw materials rises; d when aggregate demand increases
f; a when the money price of raw materials changes
e when aggregate demand increases; d when the money price of raw materials rises

In Lotus Land, real GDP is $500 billion, the price level is 120, and the quantity of money is $50 billion. The velocity of circulation in Lotus Land is ___________.

10
1,200
8.3
12

When the economy is at full employment and an inflation is anticipated, ___________________.

real GDP decreases to less than potential GDP
real GDP increases to more than potential GDP
real GDP remains at potential GDP
potential GDP increases

When aggregate demand increases by more than it is expected to increase, the __________________.

economy moves up along the short-run Phillips curve
the short-run Phillips curve shifts leftward
economy moves down along the short-run Phillips curve
the long-run Phillips curve shifts leftward

The figure shows an economy's Phillips curves. Currently, the inflation rate is 4 percent a year. The natural rate of unemployment is _______ percent and the expected inflation rate is _______ percent per year.

3; 4
3; 5
5; 4
5; 3

The figure shows an economy's Phillips curves. Currently, the inflation rate is 4 percent a year. If inflation expectations remain unchanged, the current unemployment rate is __________________.

equal to the natural rate
greater than the natural rate
less than the natural rate
4 percent

The real interest rate is 6 percent a year. When the expected inflation rate is zero, the nominal interest rate is approximately _______ percent a year; and when the expected inflation rate is 2 percent a year, the nominal interest rate is approximately _______ percent a year.

6; 12
6; 8
0; 2
6; 4

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