EC140 - Midterm 1 (CHAPTER 19)question with accurate answers(verified)Graded A+

In general, productivity is a measure of A. potential output. B. the amount of output that the economy produces per unit of input. C. real GDP as a function of total employment. D. the economy's ability to increase real GDP per capita. E. the total amount of output that the economy is capable of producing. - Answers-B. the amount of output that the economy produces per unit of input. Inflation is the rate of change of average prices in the economy. In general, we can say that inflation A. increases the real value of fixed money incomes. B. has no real effects if it is unanticipated. C. increases the purchasing power of money. D. reduces the real value of existing nominal debt. E. benefits creditors if it is unanticipated. - Answers-D. reduces the real value of existing nominal debt.