The monetary base is smaller than the money supply
Indicate whether the statement is true or false
TRUE
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Refer to the above figure. Suppose the economy is in equilibrium at point A
If the Fed tries to stimulate the economy by undertaking an expansionary monetary policy action and this is not expected by the people in the economy, we would expect to see A) aggregate supply shifts up as people anticipate the effects of the expansionary monetary system. In the short run, real GDP falls to $13 trillion and the price level rises to 120. In the long run, real GDP returns to $14 trillion, and the price level increases further, to 150. B) aggregate demand increases but people would anticipate this, causing the short-run aggregate supply curve to shift up at the same time, with the new equilibrium of $14 trillion of real GDP and a price level of 100. C) aggregate demand increases, real GDP increases, and the price level increases in the short run. In the long run, people realize the real situation, causing the short-run aggregate supply curve to shift u
Bid-rigging is more likely when
a. auctions are larger b. auctions are infrequent c. auctions generate the same set of potential bidders d. the auctioneer is paid on commission rather than a fixed fee
Assume that GDP growth in a particular country is 4 percent per year. How many years it will take for GDP to double?
a. 80.0 years. b. 17.5 years. c. 10.0 years. d. 20.0 years. e. 20.5 years.
A nation's capital stock was valued at $500 billion at the start of the year and $575 billion at the end. Consumption of private fixed capital in the year was $35 billion. Assuming stable prices, net investment was ________.
A. $40 billion B. $75 billion C. $35 billion D. $45 billion