As the housing bubble collapsed, and the value of homes decreased, consumers’ loss of wealth led to:
A. decreased consumption, which increased prices, which increased the costs of production, leading to more job loss.
B. decreased consumption, which further depressed prices, which reduced output further, leading to more job loss.
C. increased consumption, which increased prices, which increased the costs of production, leading to more job loss.
D. decreased consumption, which further depressed prices, which decreased the amount people had to spend, and increased savings.
B. decreased consumption, which further depressed prices, which reduced output further, leading to more job loss.
You might also like to view...
Which of the following individuals is NOT counted as unemployed?
A) Jackie, who was recently fired and is now applying for another job B) Jennifer, who just graduated from college and is now seeking employment with the company of her dreams. C) Jamil, who recently quit his job and is looking for a new position D) Jack, who has become discouraged about ever finding a job and has stopped looking
Suppose that the European Central Bank enacts expansionary policy. Everything else held constant, this will cause the demand for U.S. assets to ________ and the U.S. dollar to ________
A) increase; appreciate B) decrease; appreciate C) increase; depreciate D) decrease; depreciate
Cross-price elasticity of demand measures
a. elasticity of demand at the intersection of the supply and demand curves b. elasticity of supply at the intersection of supply and demand curves c. the relative elasticity of supply and demand at the intersection of the two curves d. the relationship between the demand for one good and the price of another e. the relationship between the demand for one good and the supply of another
The Fed purchases of long-term assets to stabilize financial markets, reduce long-term interest rates, and improve the investment environment are called: a. structural adjustments. b. financial strengthening. c. quantitative easing
d. inflation targeting. e. stress testing.