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
Answer: C
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Which of the following will lead to a decrease in the gross domestic product of a country, all other variables remaining unchanged?
A) An increase in exports B) An increase in the expenditure on investment C) An increase in imports D) An increase in the expenditure on consumption
The government uses the buying power of wages rather than face value or nominal value in reporting changes in "real wages" in the economy
Indicate whether the statement is true or false
Holding other things constant, a decrease in the inflation rate in the US compared to the Canadian economy may cause the demand for dollar to _____________ and the supply for dollar to __________
a. Increase; decrease b. Increase, increase c. Decrease; Increase d. Decrease; Decrease
Empirical evidence suggests that the relative scarcity of most resources is
a. declining. b. increasing slowly. c. increasing rapidly. d. largely unchanged over the past four decades.