An expansionary monetary policy is most likely to increase real output
a. when the economy is operating at less than full-employment capacity.
b. when the economy is at full employment.
c. when actual output is beyond the economy's long-run capacity.
d. when the inflationary side effects are fully anticipated by decision makers.
A
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Consumers make all economic decisions in a mixed economy
Indicate whether the statement is true or false
Suppose that the average equilibrium monthly rental price of apartments and rooms in a college town had been steady at $600, but then the college expanded enrollment from 10,000 to 12,000 . Suddenly there is a shortage of rental housing at the prevailing price of $600 . Which of the following is most likely to be true?
a. The shortage occurred because demand increased, and a new market equilibrium will result in higher rental prices and more rental units available on the market. b. The shortage occurred because supply increased, and a new market equilibrium will result in lower rental prices and fewer rental units available on the market. c. The shortage occurred because demand decreased, and a new market equilibrium will result in lower rental prices and fewer rental units available on the market. d. The shortage occurred because demand increased, and a new market equilibrium will result in higher rental prices and fewer rental units available on the market.
When a borrower fails to pay back a loan according to the agreed-upon terms, it is called:
A. credit risk. B. default. C. opportunity cost. D. inflation.
Low rates of inflation are generally associated with
a. low rates of government spending. b. small or nonexistent government budget deficits. c. low rates of productivity growth. d. low rates of growth of the quantity of money.