Which of the following events occur when fiscal expansion is used without accommodating monetary policy?
A) Total government spending increases (or net taxes decrease).
B) Total private induced spending increases.
C) Private induced spending decreases.
D) A and B are both correct.
D
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If the economy is characterized by a certain and stable LM curve, then ________ target produces ________ fluctuations in aggregate output
A) an interest rate; smaller B) a money supply; smaller C) a money supply; larger D) an exchange rate; larger
According to the Monetarists, the real effect of monetary policy on output is
a. long-lasting and unpredictable. b. predictable and beneficial. c. nonexistent in the short run. d. always less than fiscal policy
According to Edward Denison, the United States has experienced
a. diseconomies of scale. b. economies of scale. c. constant returns to scale. d. None of the above
Savings that pay for capital investment can come from:
A. outside a country. B. within a country. C. domestic savings. D. All of these are true.