If the economy is in an inflationary period, what type of Fiscal Policy action should be undertaken?
(a) Decrease taxes.
(b) Decrease the discount rate.
(c) Increase taxes.
(d) Increase government spending.
Answer: (c) Increase taxes.
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The possibility that unanticipated policy changes are an important source of output fluctuations is most consistent with ________
A) traditional Keynesian theory B) new Keynesian theory C) real business cycle theory D) institutionalist theory
Increases in the price of imported oil in 2011 led to a leftward shift of the aggregate supply curve
a. True b. False Indicate whether the statement is true or false
What variable adjusts to balance demand and supply in the market for loanable funds?
The settling of any net deficit in the combined current, and capital and financial accounts is done with:
A. Capital reserves B. Official reserves C. Net transfers D. Net investment income