An increase in aggregate demand in the long run, will change:
A. both output and the price level.
B. output but not price level.
C. neither output nor the price level.
D. the price level but not output.
Answer: D
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When expansionary fiscal and monetary policies are joined with a ________ exchange rate system, the various components of economic policy often interact in ways that lead to a crisis followed by a steep recession
A) fixed B) floating C) crawling peg D) flexible
Bond covenants are used to address the riskiness of bonds
Indicate whether the statement is true or false
The three main monetary policy tools used by the Federal Reserve to manage the money supply are
A) interest rates, tax rates, and government spending. B) tax rates, government purchases, and government transfer payments. C) open market operations, discount policy, and reserve requirements. D) open market operations, the exchange rate of the dollar against foreign currencies, and government purchases.
Which of the following can be categorized as a commodity money standard?
a. The pegged exchange rate standard b. The free float standard c. The managed float standard d. The reserve currency standard e. The gold standard