Which of the following would not cause the consumption-income line to shift upward?
a. An increase in income
b. An increase in autonomous consumption
c. A decrease in the interest rate
d. Greater optimism about economic conditions
e. An increase in household wealth
A
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Which of the following is the most accurate description of events when monetary authorities increase the size of commercial banks' excess reserves?
A. A rise in interest rates increases the money supply, causing a decrease in investment spending, output, and employment. B. The money supply is decreased, which increases the interest rate, and causes investment spending, output, and employment to decrease. C. A fall in interest rates decreases the money supply, causing an increase in investment spending, output, and employment. D. The money supply is increased, which decreases the interest rate and causes investment spending, output, and employment to increase.
In the economic way of thinking, a tax on pollutants
A) unfairly places the burden of pollution reduction on the poor. B) is inefficient because it won't reduce pollution to zero. C) tries to alter relative money costs to reflect new decisions about who has which rights. D) cannot be labeled unfair as long as the tax revenues are used to fund public works projects.
What is seigniorage? What are the factors that determine whether a currency should emerge as the dominant reserve currency?
What will be an ideal response?
Which one of the following macroeconomic theories is most closely associated with the Laffer curve?
A. Monetarism B. New classical economics C. Keynesian economics D. Supply-side economics