A change in monetary policy has a larger effect on aggregate demand the a. flatter the LM curve. b. the less elastic money demand. c. more elastic money demand. d. steeper the IS curve. e. the steeper the LM curve. ANSWER E
Date: September 10th, 2020
When a government has decided on a permanent spending increase, a valid reason to increase borrowing rather than taxes might be to ________. A) to avoid an unnecessary stimulus to aggregate demand B) to shift the burden from domestic taxpayers to foreign bond holders C) to avoid distortions that might reduce long-run aggregate supply D) […]
Date: September 10th, 2020
Both indentured servants and slaves had rights in courts of law. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
In the short-run production function, the following variables must be endogenous: a. technology. b. labor input. c. capital input. d. b and c. e. none of the above. ANSWER B
Date: September 10th, 2020
What was the largest and most important economic event of the 1900s? a. The terrorist attacks of 9/11. b. Ronald Reagan’s tax cuts. c. The Great Depression. d. The inflation of the 1970s. ANSWER C
Date: September 10th, 2020
If interest rates and output rises, then a. government spending may have fallen. b. the money supply may have risen. c. taxes may have risen. d. expectations may have risen. e. none of the above. ANSWER D
Date: September 10th, 2020
In general equilibrium A) supply equals demand for all goods in all periods. B) supply equals demand for most goods in all periods. C) supply equals demand in present value, but not in all periods. D) prices are exogenous. ANSWER A
Date: September 10th, 2020
A higher rate of saving at the national level will, in the long-run ________. A) cause a decrease in levels of capital and output B) have no effect on levels of capital and output C) lead to an increase in population growth D) cause an increase in levels of capital and output ANSWER D
Date: September 10th, 2020
If money demand does not depend on the interest rate then a. the LM curve if vertical and fiscal policy is ineffective. b. the LM curve is horizontal and fiscal policy is ineffective. c. the LM curve is horizontal and horizontal has no effect on output. d. the LM curve is vertical and monetary policy […]
Date: September 10th, 2020
In the liquidity trap case where the LM schedule is nearly horizontal, a. both monetary and fiscal policy are highly effective. b. monetary and fiscal policy are ineffective. c. monetary policy is ineffective and fiscal policy is effective. d. fiscal policy is ineffective and monetary policy is effective. ANSWER C
Date: September 10th, 2020
