Which one of the following statements is the MOST accurate?
A) Given PUS, when the money supply rises, the dollar interest rate declines and the dollar depreciates against the euro.
B) Given YUS, when the money supply rises, the dollar interest rate declines and the dollar depreciates against the euro.
C) Given PUS and YUS, when the money supply decreases, the dollar interest rate declines and the dollar depreciates against the euro.
D) Given PUS and YUS, when the money supply rises, the dollar interest rate declines and the dollar appreciates against the euro.
E) Given PUS and YUS, when the money supply rises, the dollar interest rate declines and the dollar depreciates against the euro.
E
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The main point of the second theorem of welfare economics is that:
A) efficiency is more important than equity. B) efficiency may be achieved, but equity is not a feasible goal. C) any attempt to achieve an equitable outcome must occur off the contract curve. D) any equitable outcome can be achieved by reallocating the resources among the members of a society.
In the aggregate expenditures model, if an economy operates above equilibrium GDP, there will be:
a. unplanned inventory depletion. b. an increase in GDP. c. a decrease in employment. d. an increase in employment.
When the Federal Reserve buys new government bonds, it is borrowing from the government
a. True b. False
An increase in the marginal propensity to save from .1 to .2 will cause
A) an increase in the multiplier and a given change in autonomous consumption (c0 ) to have a smaller effect on output. B) an increase in the multiplier and a given change in autonomous consumption (c0 ) to have a larger effect on output. C) a reduction in the multiplier and a given change in autonomous consumption (c0 ) to have a smaller effect on output. D) a reduction in the multiplier and a given change in autonomous consumption (c0 ) to have a larger effect on output.