According to political business cycle theory, if the Fed wanted to increase the chances of a President's re-election, what specific actions might it take?
If the Fed wanted to see the President re-elected it would take actions to boost the economy. This might include purchasing government bonds, lowering the discount rate, increasing its lending to banks, lowering reserve requirements, or decreasing the interest rate on reserves.
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If a shift in aggregate demand only affects real Gross Domestic Product (GDP), then the short-run aggregate supply (SRAS) curve must be
A) upward sloping. B) downward sloping. C) horizontal. D) vertical.
Refer to Figure 18.3. The opportunity cost of producing pogo sticks in Livonia is
A) 2/3 of a scooter. B) 4/5 of a scooter. C) 6/5 scooters. D) 1.25 scooters.
Which of the following is a thrift institution?
i. a credit union ii. the Fed iii. a savings bank A) i only B) ii only C) iii only D) Both i and iii E) i, ii, and iii
If a perfectly competitive firm decides to shut down in the short run, its loss will equal its
A) minimum average variable cost, AVC. B) total variable cost, TVC. C) total fixed cost, TFC. D) average total cost, ATC.