Explain why each of the following is not a valid argument for protection
(a) patriotism
(b) fair play (e.g. level international playing fields)
(c) preservation of jobs
(a) Protection can lower welfare, which would be unpatriotic.
(b) The notion of fair play does not conform well to the real world. Fair play for producers would be unfair for consumers, etc.
(c) Protection tends to redistribute jobs rather than create new ones.
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On the graph above, if output is falling, while the quantity demanded is rising, the economy may be at a point on ________
A) the aggregate supply curve above the aggregate demand curve B) the aggregate supply curve below the aggregate demand curve C) the aggregate demand curve above the aggregate supply curve D) the aggregate demand curve below the aggregate supply curve E) none of the above
Based on this graph, which of the following are the key results of an expansionary monetary policy?
a. Price level increases; real gross domestic product increases; aggregate demand increases.
b. Price level decreases; real gross domestic product increases; aggregate demand increases.
c. Price level decreases; real gross domestic product decreases; aggregate demand increases.
d. Price level increases; real gross domestic product decreases; aggregate demand decreases.
An increase in the federal funds rate could be caused by:
A. an open market purchase of government securities. B. an increase in the excess reserves of the banking system. C. an increase in the reserve requirement. D. a cut in the discount rate.
The relationship between the level of prices and the quantity of real GDP supplied is known as:
A. aggregate supply. B. market supply. C. aggregate demand. D. market demand.