If there is an autonomous decrease in spending (a leftward shift in the aggregate demand curve) and the Fed wishes to hold real income constant, then the Fed would:
A) decrease the money supply yielding a leftward shift in the aggregate demand curve.
B) increase the money supply yielding a rightward shift in the aggregate demand curve.
C) hold the money supply constant.
D) none of the above.
B
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A circular flow model shows the interrelationship between the ________ market and the ________ markets
A) household; goods B) household; factor C) business; household D) expenditure; income E) goods; factor
The equity premium is the return
A) investors expect to equal a risk free investment. B) covered by stockholder insurance. C) on bonds. D) investors expect above a risk free investment.
Which of the following is a component of aggregate demand?
What will be an ideal response?
The largest component of national income is:
A. compensation of employees. B. rents. C. interest. D. corporate profits.