If the Fed orders a contractionary monetary policy, describe what will happen to the following variables relative to what would have happened without the policy:
a. The money supply
b. Interest rates
c. Investment
d. Consumption
e. Net Exports
f. The aggregate demand curve
g. Real GDP
h. The price level
a. The money supply decreases
b. Interest rates rise
c. Investment decreases
d. Consumption decreases
e. Net exports decrease
f. The aggregate demand curve shifts to the left
g. Real GDP falls
h. The price level falls
You might also like to view...
Use the following graph to answer the next question.
If the industry were served by a pure monopoly, the deadweight loss would be the area ________.
A. ACE B. AEF C. ACB D. This can't be determined with the information provided in the graph.
In the context of the environment, the type of transactions costs that includes sampling the emissions of many companies to determine which company or companies are emitting pollution are called
A) search costs. B) collectivization costs. C) negotiation costs. D) monitoring and enforcement costs.
Suppose you were told that Botswana had few skilled workers, a primitive banking system, and an inefficient and limited electric power industry. You would know that the person was describing was Botswana's problem with
a. its economic infrastructure b. political stability c. its agricultural sector d. its traditional values e. poverty
If marginal cost exceeds average total cost in the short run, then which is likely to be true?
A. Average total cost is increasing B. Average variable cost is decreasing C. Average total cost is less than average variable cost D. Marginal cost is less than average variable cost