In the short run, the expansion path is
A) horizontal.
B) vertical.
C) diagonal.
D) indeterminate.
A
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An increase in the money ________ shifts the LM curve to the ________, causing the interest rate to fall and output to rise, everything else held constant
A) demand; right B) demand; left C) supply; right D) supply; left
A bond buyer is a
a. saver. Bond buyers must hold their bonds until maturity. b. saver. Bond buyers may sell their bonds prior to maturity. c. borrower. Bond buyers must hold their bonds until maturity. d. borrower. Bond buyers may sell their bonds prior to maturity.
If it is the real rate of interest that savers and borrowers respond to, how does the Fed impact a real rate by targeting a nominal rate of interest?
What will be an ideal response?
If real GDP decreased during a year, then output must have decreased.
Answer the following statement true (T) or false (F)