Other things equal, a decrease in the cost of capital would be associated with an upward shift of the investment function and, hence, with a rise in aggregate expenditures
a. True
b. False
Indicate whether the statement is true or false
True
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Contractionary monetary policy causes ________
A) real output to rise B) the aggregate price level to fall C) the aggregate price level to rise D) real interest rates to fall
If the official settlements account is zero, whenever the United States has a current account deficit, it must also have a capital account deficit
Indicate whether the statement is true or false
Because there is a finite supply of a nonrenewable resource,:
a. it has inadequate substitutes. b. any use of that resource today will leave less available for tomorrow. c. such resources are replenished faster than they are consumed. d. the government subsidizes the extraction of such resources. e. any use of that resource today means the value of the resource will fall in the future.
The main reason the usefulness of Pareto optimal policies is limited as a policy guide is that:
A. it is too subjective. B. real-world changes in which more people are helped than are harmed are rare. C. real-world changes in which no one is harmed are rare or nonexistent. D. it is only objective, and good policy also requires a subjective element.