If the consumer's income and all prices simultaneously double, then the optimum consumption bundle will
a. shift outward relative to the original optimum.
b. move leftward along the original budget constraint.
c. not change.
d. shift inward relative to the original optimum.
c
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Refer to Figure 15-12. In the dynamic AD-AS model, if the economy is at point A in year 1 and is expected to go to point B in year 2, and the Federal Reserve pursues no policy, then at point B
A) there is pressure on wages and prices to fall. B) the unemployment rate is greater than the natural rate of unemployment. C) firms are producing above capacity. D) incomes and profits are falling.
Everything else equal, technological change will typically
a. move the economy along a fixed production function, increasing both productivity and output b. move the economy along a fixed production function, increasing output but lowering productivity c. cause the production function to shift upward, increasing both output and productivity d. cause the production function to shift upward, increasing output but lowering productivity e. cause the production function to shift upward, increasing output but leaving productivity unchanged
Why is the supply of loanable funds often interest inelastic?
Which is not something the Fed can do directly to conduct monetary policy?
A. Change the reserve requirement B. Change the exchange rate C. Change the discount rate D. Execute open market operations