An automatic stabilizer is a feature of the economy that
a. makes prices "sticky."
b. reduces its sensitivity to shocks.
c. maximizes its volatility.
d. automatically reduces recessionary trends.
b
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The exchange rate is the ________.
A. market on which currencies of various nations are traded for one another B. rate at which two currencies can be traded for each other C. quantity of foreign currency assets held by a government for the purpose of purchasing the domestic currency in the foreign exchange market D. price of the average domestic good or service relative to the price of the average foreign good or service, when prices are expressed in terms of a common currency
If firms and workers have adaptive expectations, what impact will expansionary monetary policy have on inflation, unemployment, and the Phillips curve?
What will be an ideal response?
Which of the following is the most likely cause of most recessions according to the Keynesian model?
a. a fall in productivity. b. an increase in taxation and government spending. c. a fall in expected profits. d. a rise in the price of oil. e. a fall in the money supply.
Refer to Table 3.1 to answer the following questionTable 3.1 Individual Demand and Supply SchedulesQuantity Demanded byPriceAlejandroBenCarlMarket$8.00842________6.001244________4.002046________2.002246________Quantity Supplied byPriceAveryBrandonCassandra $8.006046________$6.004244________$4.002442________$2.00640________In Table 3.1, the equilibrium market price is
A. $6. B. $4. C. $2. D. $8.