Refer to the above figure. Dissaving occurs,
A. only at point A.
B. to the left of point B.
C. only at point B.
D. to the right of point B.
Answer: B
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Briefly describe how imports and taxes affect the size of the expenditure multiplier
What will be an ideal response?
Refer to Figure 15-7. Suppose the Fed sells Treasury Bills in pursuit of contractionary monetary policy. Using the static AD-AS model in the figure above, this situation would be depicted as a movement from
A) B to C. B) B to D. C) C to B. D) C to D. E) A to B.
The Federal Reserve was created
a. in 1913 by Congress b. as a result of the Great Depression c. according to the standards enforced by NATO d. by President Kennedy
Exchange rates are important because
A) They affect the affordability of imports B) they make exports either more or less expensive for foreign buyers C) They affect the value of foreign assets and their returns D) all of the above