If a country was operating well below its long-run capacity (potential GDP), the initial impact of an unanticipated increase in the money supply would most likely result in an increase in
a. prices with little change in output.
b. output with little change in prices.
c. output and a decline in prices.
d. prices and a decline in output.
B
You might also like to view...
Why does a firm in perfect competition produce the quantity at which marginal cost equals price?
What will be an ideal response?
The U.S. dollar is one of the leading reserve currency in the world. This means that
A) dollars are often used to settle international debts and to state other currency exchange values. B) dollars are the most common currency for savings internationally. C) dollars are held to cover shortfalls in government budgets. D) dollars are accepted in just about every country in the world.
If a good has an elastic demand, then:
A. a small percentage change in price will cause a larger percentage change in quantity demanded. B. a small percentage change in price will cause virtually no change in quantity demanded. C. a large percentage change in price will cause a smaller change in quantity demanded. D. any percentage change in price will cause an almost immediate response in quantity demanded.
Common ownership may fail to ensure that harvesting of renewable resources does not exceed the maximum sustainable yield
a. True b. False Indicate whether the statement is true or false