A cartel of 10 firms that controls 100 percent of the output in a market and faces the same cost schedules that a monopolist would in the market will have to set a price somewhat lower than the monopoly price for its product.
Answer the following statement true (T) or false (F)
False
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Starting from long-run equilibrium, a large increase in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; potential B. recessionary; higher; potential C. recessionary; lower; lower D. expansionary; higher; higher
Which of the following statements is true?
A) The Fed can influence the money supply in the economy by influencing the required amount of reserves. B) The Fed can reduce the growth of money supply by increasing the growth in bank reserves. C) The rate of inflation in the long run is equal to the rate of growth of real GDP minus the rate of growth of money supply. D) The Fed has the power to dictate the volume of deposits held with commercial banks.
By participating in international financial markets, a nation can finance its government budget deficit in part by ________, which ________ the link between the nation's deficit and its internal private investment
A) buying foreign assets, strengthens B) buying foreign assets, weakens C) selling assets to foreigners, strengthens D) selling assets to foreigners, weakens
A decrease in the inflation rate will lead to a ________ nominal interest rate, which will ________ the debt-to-GDP ratio
A) higher; raise B) higher; reduce C) lower; raise D) lower; reduce