Which of the following is an example of a supply shock?
A) a surprise increase of the money supply B) an increase in the price level
C) a sharp increase in the price of oil D) an increase in government spending
C
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What does it mean for a nation to have an absolute advantage in producing a product?
What will be an ideal response?
Monetizing the budget deficit
A) creates a full-employment deficit that exceeds the actual deficit. B) occurs when the Treasury sells bonds to businesses. C) helps stabilize the economy. D) leads to increases in the money supply.
Elasticity is a measure of
a. the slope of a linear demand curve b. the slope of a supply curve c. relative responsiveness d. economic welfare e. consumer tastes
An international financial crisis will likely occur when
A. the rate of money supply growth is not the same in all nations. B. newly-acquired political freedom in a country leads some interest groups to form a coalition limiting competition. C. many international investors look at the behavior of a few large investors to determine when funds should be withdrawn from a particular country. D. there is an increase in portfolio investment.