In the liquidity trap, the demand curve for investment is horizontal
Indicate whether the statement is true or false
False
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Which of the following is TRUE?
I. As the real interest rate increases, people increase the quantity they save. II. The supply of loanable funds curve is downward sloping. III. As disposable income increases, the supply of loanable funds curve becomes steeper. A) I and III B) II and III C) I only D) III only
If the government removes a binding price floor from a market, then the price received by sellers will
a. decrease, and the quantity exchanged in the market will decrease. b. decrease, and the quantity exchanged in the market will increase. c. increase, and the quantity exchanged in the market will decrease. d. increase, and the quantity exchanged in the market will increase.
What are the relationships between the marginal cost curve and the average cost curves? Explain in words
What will be an ideal response?
Answer the following statements true (T) or false (F)
1. Business cycles refer to short term fluctuations in prices. 2. Real GDP can change due to changes in the price level. 3. If nominal GDP is rising faster than real GDP, then inflation must be occurring. 4. Real GDP is calculated using current prices of outputs. 5. Inflation refers to an increase in the overall level of prices.