According to the interest-rate-based transmission mechanism for monetary policy, an increase in the money supply will cause the
A. interest rate to rise, causing planned real investment spending to rise and leading to a decrease in aggregate demand.
B. interest rate to fall, causing planned real investment spending to fall and leading to an increase in aggregate demand.
C. interest rate to fall, causing planned real investment spending to rise and leading to a decrease in aggregate demand.
D. interest rate to fall, causing planned real investment spending to rise and leading to an increase in aggregate demand.
Answer: D
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Refer to Table 2-15. What is George's opportunity cost of mowing a lawn?
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Figure 7-14
Of the long-run AC curves in Figure 7-14, which displays increasing returns to scale for all levels of output?
A. 1 B. 2 C. 3 D. 4
Which of the following is an example of cyclical unemployment?
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a. Unanticipated inflation b. Cost-push inflation c. Anticipated inflation d. Demand-pull inflation