Rising inflation causes quantity demanded to decline, because ________
A) the central bank raises the nominal interest rate by more than the increase in expected inflation
B) households and businesses are reluctant to spend when prices rise
C) higher inflation causes the IS curve to shift to the left
D) all of the above
E) none of the above
A
You might also like to view...
________ is among the ingredients of "a first-rate financial system."
A) Government-directed credit to key economic sectors B) Greater efficiency of state-owned banks C) Legal reform to strengthen financial contracts D) Saving rates of 20% or more
Given a market equilibrium point, explain, using the concepts of demand and supply, how it is achieved
What will be an ideal response?
In what way does this map serve as an abstraction?
Zoom out to the highest level. How does this affect the level of abstraction? When would each type of map be most useful? Generalize this argument by discussing the level of abstraction needed for alternative economic models.
According to the theory of the political business cycle, the fed expands the money supply before presidential elections to stimulate the economy and favor the incumbent administration
a. True b. False Indicate whether the statement is true or false