If U.S. real interest rates fall, international repercussions put _________________ pressure on the price level and __________________ pressure on Real GDP in the United States
A) upward; upward
B) upward; downward
C) downward; upward
D) downward; downward
A
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An individual deposits $12,000 in a commercial bank. The bank is required to hold 10% of all deposits on reserve. The deposit increases the loan capacity of the bank by
A. $9,600. B. $6,000. C. $10,800. D. $11,000.
The substitution effect explains why there is an inverse relationship between the price of a product and the quantity of the product demanded
Indicate whether the statement is true or false
When a positive externality is present in a market, total surplus is:
A. higher when buyers receive a Pigouvian subsidy for the externality. B. lower when buyers receive a Pigouvian subsidy for the externality. C. higher when buyers only consider private benefits. D. Any of these statements could be true.
If the money supply in an economy equals $1,000 and nominal GDP equals $3,000 . then according to the equation of exchange, velocity of money: a. equals 1/3
b. equals 3. c. equals 3 million. d. cannot be determined since we do not know anything about prices. e. cannot be determined since we do not know anything about real GDP.