Suppose that the government implements expansionary fiscal policy that raises aggregate demand, but the policy is unanticipated. According to new classical theory, in the short run the price level would ____________ and Real GDP would ______________. In the long run, new classical theory would predict that the price level would ______________ compared to its original long-run equilibrium level
and that Real GDP would ____________.
A) rise; decline; rise; remain unchanged
B) rise; rise; rise; remain unchanged
C) rise; decline; remain unchanged; rise
D) fall; rise; remain unchanged; rise
B
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The conflict between the Vice President of Marketing and her sales staff arises because
a. the sales staff are unwilling to offer discounts b. the Vice President does not want to negotiate aggressively enough c. the sales staff do not want to negotiate too aggressively d. the Vice President is more willing to offer discounts to make the sale
International specialization and trade according to the principle of comparative advantage is mutually beneficial for all economies involved
a. True b. False Indicate whether the statement is true or false
The Fed can influence:
A. the budget of the federal government. B. the household savings rate. C. U.S. tax rates. D. the U.S. money supply.
Quotas and tariffs provide the same outcome: restriction of international trade and higher prices for consumers.
Answer the following statement true (T) or false (F)