An economic policy initiative results in the AD curve shifting to the right. As a result,
A) the price level will rise.
B) the price level will stay constant.
C) the price level will fall.
D) Real GDP will rise in the short run.
E) a and d
E
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Inefficiency in an economy can be caused by
A. misallocating resources. B. underemploying resources. C. discrimination. D. All of the responses are correct.
Javier has been thinking about purchasing a bond but is afraid that the bond will lose value. He has decided to hold money instead. This is known as the
A) money balance demand for money. B) precautionary demand for money. C) transactions demand for money. D) asset demand for money.
Referring to Figure 19.2, a depreciation of the dollar is represented by a movement from point
A) a to c. B) c to a. C) c to d. D) b to a.
Over the past half-century, government transfer payments have increased. As a result ________
A) interest payments on government debt have declined B) government expenditures have become a larger portion of GDP C) the volatility of investment expenditures has declined D) net exports have been positive in most years E) none of the above