Refer to the above figure. The economy initially is at point A. The Fed unexpectedly increases the money supply. Which of the following statements are TRUE?
A) In the short run, the economy will move from point A to point C. In the long run, the economy will move to point B.
B) In the short run, the economy will move from point A to point C. In the long run, the economy will move back to point A.
C) In the short run, the economy will move from point A to point B. In the long run, the economy will stay at point B.
D) In the short run, the economy will move from point A to point B. In the long run, the economy will move back to point A.
D
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The U.S. dollar exchange rate, e, where e is the nominal exchange rate expressed as Japanese yen per U.S. dollar, will appreciate when:
A. U.S. consumers increase their preference for Japanese cars. B. the Bank of Japan tightens monetary policy. C. real GDP in the U.S. increases. D. the U.S. Federal Reserve tightens monetary policy.
"A single-price monopoly charges a higher price and produces more output than a perfectly competitive industry." Is the previous statement correct or incorrect? Explain your answer
What will be an ideal response?
The above table shows the demand schedule and supply schedule for chocolate chip cookies. An increase in income results in an increase in the demand for chocolate cookies by an amount of 3 pounds at every price
What are the new equilibrium quantity and equilibrium price? A) 5 pounds, $4.00 per pound B) 5 pounds, $6.00 per pound C) 5 pounds, $5.00 per pound D) 4 pounds, $5.00 per pound
If the required reserve ratio, m, is 20 percent, then the oversimplified money multiplier is
a. 10. b. 5. c. 4. d. 2.