Workers expect inflation to rise from 3% to 5% next year. As a result, this should
A) shift the short-run aggregate supply curve to the left.
B) shift the short-run aggregate supply curve to the right.
C) move the economy up along a stationary short-run aggregate supply curve.
D) move the economy down along a stationary short-run aggregate supply curve.
Answer: A
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Countries that engage in trade will tend to specialize in goods in which they have a(n) _______ and will _______ those goods.
A) comparative advantage; import B) absolute advantage; export C) comparative advantage; export D) economic profit; import
Ceteris paribus, which of the following would generally cause an increase in the demand curve for new automobiles?
A. The new models being perceived as ugly compared with old models. B. Consumer expectations that the price of new automobiles will be lower next year. C. A decrease in the price of new automobiles. D. An increase in consumers' income.
Explain how the Fed increases the money supply when it buys bonds in the open market
What will be an ideal response?
The reserve ratio is 10 percent. Depositors regularly keep 10 percent of their deposits as cash. If the Fed buys $1 million of U.S. government securities, excess reserves
A) increase by $800,000. B) increase by $810,000. C) increase by $900,000. D) increase by $1 million.