The Fed and the government are working against each other if, as the government cuts taxes to promote economic growth, the Fed
a. sells government securities.
b. buys government securities.
c. lowers the discount rate.
d. lowers the prime rate.
a
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According to the expenditure approach to measuring GDP, in the United States , the largest component of GDP is
A) net exports of goods and services. B) consumption expenditure. C) government expenditure on goods and services. D) investment. E) wages.
Trade restrictions are often motivated by a desire to save domestic jobs threatened by competition from imports. Which of the following counter-arguments is made by economists who oppose trade restrictions?
A) Trade restrictions have a limited impact because most Americans prefer domestic goods over imports. B) Consumers pay a high cost for jobs saved through trade restrictions. C) Trade restrictions benefit consumers in the short run but not in the long run. D) Statistics show that trade restrictions actually do not save jobs.
When the price of oil rises unexpectedly, the equilibrium price level ________ and the unemployment rate ________ in the short run
A) rises; falls B) falls; rises C) falls; falls D) rises; rises
If Congress decides to reduce the tax per pack paid by sellers of cigarettes, other things being equal, the equilibrium price of cigarettes will fall. This fall in the equilibrium price can be attributed to a(n):
a. upward movement along the supply curve for cigarettes. b. rightward shift of the supply curve for cigarettes. c. upward movement along the demand curve for cigarettes. d. leftward shift of the supply curve for cigarettes.