19. One problem with the consumer price index stems from the fact that, over time, consumers tend to buy largerquantities of goods that have become relatively less expensive and smaller quantities of goods that have become relativelymore expensive. This problem is calleda. price-change neglect.b. unmeasured quality change.c. substitution bias.d. relative bias.20. The discount rate isa. the interest rate the Fed charges banks.b. one divided by the difference between one and the reserve ratio.c. the interest rate banks receive on reserve deposits with the Fed.d. the interest rate that banks charge on overnight loans to other banks.21. Which of the following is an example of barter?a. A parent gives a teenager a $10 bill in exchange for her babysitting services.b. A homeowner gives an exterminator a check for $50 in exchange for extermination services.c. A barber gives a plumber a haircut in exchange for the plumber fixing the barber's leaky faucet.d. A doctor performs surgery on a patient whose insurance pays 100% of the bill.22. A bond that never matures is known asa. a perpetuity.b. an intermediary bond.c. an indexed bond.d. a junk bond.23. The economy's two most important financial markets area. the investment market and the saving market.b. the bond market and the stock market.c. banks and the stock market.d. financial markets and financial institutions.24. Bank capital isa. the machinery, structures, and equipment of the bank.b. the resources that owners have put into the bank.c. the reserves of the bank.d. the bank's total assets.25. Efficiency wagesa. increase productivity and reduce unemployment.b. increase productivity but increase unemployment.c. decrease productivity but reduce unemployment.d. decrease productivity and increase unemployment.

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19. One problem with the consumer price index stems from the fact that, over time, consumers tend to Buy quantities of goods that have become relatively less expensive and smaller quantities of goods that have become relatively more expensive. This problem is called a. price-change neglect. b. unmeasured quality change. c. substitution bias. d. relative bias.

19. One problem with the consumer price index stems from the fact that, over time, consumers tend to Buy quantities of goods that have become relatively less expensive and smaller quantities of goods that have become relatively more expensive. This problem is called a. price-change neglect. b. unmeasured quality change. c. substitution bias. d. relative bias.

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter36: Six Debates Over Macroeconomic Policy

Section: Chapter Questions

Problem 3PA

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