If the deficit is financed by selling bonds to the ________, the money supply will ________, causing aggregate demand to ________
A) public; rise; increase
B) public; fall; decrease
C) central bank; rise; increase
D) central bank; fall; decrease
C
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Which of the following underground economy activities would be considered a black market?
A. Harry makes Sally dinner while she changes the oil in his car. B. Carrie waits tables at the local restaurant for salary and tips, but only reports her salary as income. C. Celeste sells counterfeit designer bags at a roadside stand. D. Ben provides child care in his home for cash payments and does not report the income.
To eliminate built-in inflation from the economy, the Fed must
a. announce its intention to have a single policy objective b. create a recession c. maintain a constant rate of inflation d. resist the temptation to change its interest rate targets e. work closely with Congress and the President
At the equilibrium level of real GDP, which of the following is true?
A. Unplanned inventory investment is positive. B. Unplanned inventory investment is negative. C. Aggregate output equals aggregate expenditures. D. Aggregate output plus consumption spending equals aggregate expenditures.
The market demand curve for most goods and services is
A. the horizontal summation of individual demand curves. B. calculated by multiplying all individual demand curves by each other. C. not important for most analytical purposes. D. not related in any way to individual demand curves.