In the IS-LM model, if interest rates rise while output falls the a. money supply must have fallen. b. price level must have fallen. c. money supply must have risen. d. level of government spending must have fallen. e. none of the above. ANSWER A
Date: September 10th, 2020
The CPI overestimates inflation because a. it often ignores the invention of new goods. b. it always includes discount stores. c. it allows substitution from more expensive goods to cheaper goods. d. all of the above. ANSWER A
Date: September 10th, 2020
Keynesians would argue that: a. information is inherently limited. d. individuals have limited ability to process information when making decisions. c. people often make mistakes even with appropriate information. d. all of the above. e. none of the above. ANSWER D
Date: September 10th, 2020
Tariffs benefit the consumers of the import-competing goods. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
Sovereign debt crisis, a short-run phenomenon, may lead to the long-run consequence of debt ________. A) intolerance B) distortion C) seignorage D) repudiation ANSWER A
Date: September 10th, 2020
An increase in credit market frictions A) decreases labor supply. B) decreases labor demand. C) decreases consumption demand. D) decreases investment demand. ANSWER D
Date: September 10th, 2020
“Policy ineffectiveness” refers to the hypothesis that monetary and fiscal policy actions that change aggregate demand will a. neither affect output nor employment even in the short run. b. affect output and employment in both the short run and long run. c. affect output but not employment in the short run. d. not affect output […]
Date: September 10th, 2020
The value of every monetary transaction in the economy would be included in a. GDP. b. potential GDP. c. personal income. d. national income. e. None of the above. ANSWER E
Date: September 10th, 2020
In the typical bathtub, the flow of water into the tub is controlled by a faucet independently of the quantity of water in the tub. How is the bathtub analogy of the steady state in the Solow model different? How does this difference relate to the phenomenon of convergence? ANSWER In the Solow model, […]
Date: September 10th, 2020
Sustained federal deficits tend, other things the same, ________. A) to decrease income inequality in the United States B) to decrease income inequality in Europe but not the United States C) to increase income inequality in the United States D) have little effect on the distribution of income in market economies ANSWER C
Date: September 10th, 2020
