Consider an initial IS-LM equilibrium with normally-sloped curves. An increase in government spending takes us to a new equilibrium with ________ income and ________ interest rate
A) higher, a higher
B) higher, a lower
C) an unchanged, a higher
D) an unchanged, a lower
E) lower, an unchanged
A
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To have an effect on the market, a price floor should be set at a price
A. above the equilibrium price. B. equal to the equilibrium price. C. below the equilibrium price. D. at any price on the supply curve.
Potential GDP is reached when
A) unemployment is zero. B) there is no cyclical unemployment. C) unemployment is above full employment. D) unemployment is below full employment. E) the natural unemployment rate equals zero.
Refer to Figure 13-11. What is the monopolistic competitor's profit maximizing output?
A) Q1 units B) Q2 units C) Q3 units D) Q4 units
From any point below the current LM curve, money market equilibrium can be restored by some combination of a ________ income and a ________ interest rate that ________ the demand for money
A) higher, higher, increases B) higher, lower, increases C) higher, lower, reduces D) lower, higher, increases E) lower, higher, reduces