Franklin Roosevelt implemented the New Deal in the 1930s, and Congress passed the Full Employment Act of 1946 . Both were examples of the government adopting the ideas of
a. classical economics
b. rational expectations economics
c. supply-side economics
d. neo-Keynesian economics
e. Keynesian economics
E
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Examples of comparative advantage show how trade between two countries can make each better off. Compared to their pre-trade positions, trade makes both countries better off because in each country
A) wages are higher. B) total consumption of goods is greater. C) total welfare is greater. D) total employment is greater.
In Figure 4-5 above, suppose that real income is YB and the money market is in equilibrium. The interest rate at this point is ________ to support commodity market equilibrium, so that involuntary inventory changes are ________
A) too low, positive B) too low, negative C) just right, zero D) too high, positive E) too high, negative
When the Fed purchases government securities, it
a. increases banks' reserves and makes possible an increase in the money supply b. decreases banks' reserves and makes possible a decrease in the money supply c. automatically raises the discount rate d. uses discounting operations to influence margin requirements e. sends a signal to the banking community that there is too much inflation
Suppose that during World War II the long-run aggregate supply curve shifted right. In order for price and output to have changed in the direction they did, what would have to have happened to aggregate demand?
a. It would have to have shifted left by less than aggregate supply shifted b. It would have to have to shifted left by more than aggregate supply shifted. c. It would have to have shifted right by less than aggregate supply shifted d. It would have to have to shifted right by more than aggregate supply shifted.