The goal of expansionary monetary policy is to:
A. reduce interest rates to stimulate the economy.
B. increase interest rates to stimulate the economy.
C. reduce interest rates to slow down the economy.
D. increase interest rates to slow down the economy.
A. reduce interest rates to stimulate the economy.
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The price of one good produced by a multiproduct industry rises. The effect on a second good produced by that industry will be
A. a shift left in the supply curve for the second good. B. no change in the supply curve for the second good. C. a shift right of the supply curve for the second good. D. a shift right of the demand curve for the second good.
Given an upward sloping supply curve, the more inelastic is demand, the greater the fraction of the burden of taxation that is borne by consumers
a. True b. False Indicate whether the statement is true or false
If a foreign country imposes a voluntary export restraint, then the:
a. consumer surplus will be lower than would be so if the home country imposes a tariff b. producer surplus will be lower than would be so if the home country imposes a tariff. c. area of government revenue will be taken by the foreign country. d. deadweight loss is smaller than would be so if the home country imposes a tariff.
Suppose the market for grass seed can be expressed as Demand: QD = 100 - 2p Supply: QS = 3p Price elasticity of supply is constant at 1. If the demand curve is changed to Q = 10 - .2p, price elasticity of demand at any given price is the same as before. Yet, the incidence of a tax falling on consumers will be higher. Why?
What will be an ideal response?