Other things the same, which of the following responses would we expect to result from a decrease in U.S. interest rates?
a. U.S. citizens decide to hold more foreign bonds.
b. People choose to hold more currency.
c. You decide to purchase a new oven for your cookie factory.
d. All of the above are correct.
d
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A liquidity trap is
a. the vertical portion of the LM schedule. b. the horizontal portion of the LM schedule. c. a situation where a given change in the money stock induces a large reduction in the interest rate. d. Both a and c e. Both b and c
The main measure of inflation is the ________________ computed and reported each month by the Bureau of Labor Statistics
a. Consumer Price Index b. Product Producer Index c. Consumer Confidence Survey d. New Homes Sales Matrix
A strategy game is
a. any pricing competition among firms b. a situation arising from independent decision making among economic participants c. interpendent choice behavior by individuals or groups who share a common goal d. none of the above
Economist John Maynard Keynes is famous for saying, "In the long run, we are all dead." He is referring to the:
A. length of time it can take the economy to recover to potential GDP without policy intervention. B. permanent inflation that results in long-run adjustments. C. fact that no policy can affect the long-run equilibrium. D. notion the economy is sure to collapse in the long run.