Government actions that were taken in order to stimulate the economy during the Great Recession of 2007-09 included the following, except:
A. A significant reduction of interest rates to nearly zero
B. A large increase in transfer payments
C. An increase in the deficit-spending of the government
D. A sharp increase in the natural rate of unemployment
D. A sharp increase in the natural rate of unemployment
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The bond supply and demand framework is easier to use when analyzing the effects of changes in ________, while the liquidity preference framework provides a simpler analysis of the effects from changes in income,
the price level, and the supply of ________. A) expected inflation; bonds B) expected inflation; money C) government budget deficits; bonds D) government budget deficits; money
Elena Johnson owns 100 shares of Funky Foods, which has 100,000 shares of stock outstanding. Funky Foods is expected to earn $1 million in after-tax profits every year forever. The interest rate is 5 percent (0.05) per year. According to the principle of asset valuation, what is the value of Elena's shares?
a. $200,000 b. $10,000 c. $20,000 d. $100,000 e. $2,000
A "dirty float" is a system
A. Of free-floating exchange rates. B. Of managed exchange rates. C. Based on the gold standard. D. Of fixed exchange rates.
Historically, real GDP has increased less rapidly than nominal GDP because:
A. price indices have not reflected improvements in product quality. B. the general price level has increased. C. technological progress has resulted in more efficient production. D. the general price level has decreased.