An increase in the supply of loanable funds will decrease the rate of interest
Indicate whether the statement is true or false
T
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When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline
The current account does not include which of the following?
A) U.S. holdings of foreign assets B) net transfers C) net exports D) net investment income
The flaw of the Friedman model of the business cycle is that it
A) assumes away output fluctuations. B) assumes complete wage rigidity. C) assumes unrealistic fooling of workers. D) requires procyclical wage movements and continuous labor market equilibrium.
The game in Scenario 13.10 is
A) variable-sum. B) constant-sum. C) cooperative. D) a Prisoners' Dilemma. E) a Cournot Production Cross.