Which of the following will shift the aggregate demand curve to the left?
A. The government increases spending on education.
B. Income taxes are lowered.
C. Foreign economies fall into recession, reducing their demand for domestic exports.
D. Consumers become optimistic about the future.
Answer: C
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Which one of the following statements about growth theories is CORRECT?
A) In the new growth theory, knowledge is not subject to diminishing returns. B) In neoclassical growth theory, technological progress is the result of rapid increases in saving and investment in capital per person. C) In classical growth theory, real GDP per person is unrelated to the subsistence real GDP. D) In classical growth theory physical resources are unlimited.
Suppose you found $10,000 hidden under a rock and deposited it in a demand deposit account at your bank. If the reserve requirement was 20 percent, your deposit would initially add ____ to total demand deposits and over time increase the money supply by a maximum of ____
a. $2,000; $4,000 b. $2,000; $40,000 c. $10,000; $40,000 d. $10,000; $50,000
The use of computers to speed up the banking system's processing of checks explains why monetarists believed that
a. output increases as the price level increases b. the money supply affects output c. the velocity of money has increased since the 1950s d. the changes in money supply and changes in velocity are interdependent e. fiscal policy can fine tune an economy
The national defense argument has been used in the past to justify trade restrictions by firms in the peanut industry and the pottery industry
Indicate whether the statement is true or false