In 2012,U.S.core Inflation Was 2.1 Percent.This Inflation Rate

question 141

Multiple Choice

In 2012,U.S.core inflation was 2.1 percent.This inflation rate

• A) is lower than the inflation rate the Fed accepts as creating stable prices.
• B) is about equal to the inflation rate the Fed accepts as creating stable prices.
• C) is more than 2 percentage points higher than the inflation rate the Fed accepts as creating stable prices.
• D) None of the above answers are correct because the Fed has never associated an inflation rate with stable prices.

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Definitions:

Economically Successful

Refers to the state or condition where an entity, such as a person, company, or nation, achieves desired financial outcomes and sustainable growth over time.

Entrepreneur

A person who introduces new products or improved technologies and decides which projects to undertake. A successful entrepreneur’s actions will increase the value of resources and expand the size of the economic pie.

Financial Capital

Economic resources measured in terms of money used by entrepreneurs and businesses to buy what they need to make their products or to provide their services.

Law Of Supply

The principle that, all else equal, an increase in the price of goods will lead to an increase in the quantity supplied.