How do the Fed's actions influence real GDP and how long does it take for real GDP to respond to the Fed's policy changes?
What will be an ideal response?
The Fed's actions affect real GDP by changing expenditure plans. For instance, an expansionary policy by the Fed that lowers the interest rate increases consumption expenditure, investment, and net exports. All three of these changes boost aggregate demand so that real GDP growth increases. The effect on real GDP is far from immediate because there are time lags in the process. Real GDP initially responds about two years after the policy is initiated.
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________ motivates charitable giving because of selfish reasons, such as the appearance of generosity
A) Pure altruism B) Impure altruism C) Consumerism D) Rationalism
For an incumbent, investing in plant and equipment that reduces marginal cost while raising total cost makes sense if
A) the incumbent's profit fro, producing the entry-deterring level of output after making the investment exceeds the profit the firm would earn if it didn't make the investment and entry occurred B) the incumbent's profit from producing the entry-deterring level of output after making the investment is positive C) the potential entrant cannot enter the market profitably after the incumbent makes the investment and produces the entry-deterring level of output D) the potential entrant would not enter the market anyway
Efficiency factor:
What will be an ideal response?
________ is a flow of earnings per unit of time
A) Income B) Money C) Wealth D) Currency