Exhibit 10-1 Aggregate supply curve
In Exhibit 10-1, higher price levels allow producers to earn higher profits, stimulating production and employment in:
A. the segment labeled ab.
B. the segment labeled bc.
C. the segment labeled cd.
D. both segment bc and segment cd.
Answer: B
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On the books of the Fed the difference between borrowed reserves and discount loans is equal to
A) excess reserves. B) required reserves. C) currency in circulation. D) zero; they are the same thing.
Which of the following statements is true?
A. The smaller a nation's marginal propensity to save, the smaller the open-economy multiplier. B. The smaller a nation's marginal propensity to export, the larger the open-economy multiplier. C. The larger a nation's marginal propensity to import, the larger the open-economy multiplier. D. The larger a nation's marginal propensity to consume, the larger the open-economy multiplier.
A long-run aggregate supply curve may graphically be represented as a
A) vertical line. B) a downward sloping line. C) an upward sloping line. D) horizontal line.
Cost-push inflation is caused by supply shocks like higher oil prices and poor weather conditions
a. True b. False Indicate whether the statement is true or false