Which of the following Fed policies would help the economy out of a recession?
A. An increase in reserve requirements
B. Open market sales of government securities
C. Open market purchases of government securities
D. An increase in the discount rate
Answer: C
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Real GDP is $1,400 billion and nominal GDP is $1,800. The GDP price index equals
A) 100.0. B) 2.86. C) 77.0. D) 222.2. E) 128.6.
If the value of price elasticity of demand for a good is equal to "?", it implies that the good has a ________ demand
A) perfectly elastic B) perfectly inelastic C) unit elastic D) relatively inelastic
A decrease in the money supply would cause the IS curve to ________ and the LM curve to ________
A) shift down and to the left; be unchanged B) shift down and to the left; shift up and to the left C) be unchanged; shift up and to the left D) be unchanged; shift down and to the right
This prisoner's dilemma game shows the payoffs associated with two firms, A and B, in an oligopoly and their choices to either collude with one another or not.
According to the matrix shown, the profit-maximizing outcome for the firms is:
A. to act like a monopolist and both collude. B. for Firm A to compete and Firm B to collude. C. to both compete. D. for Firm B to compete and Firm A to collude.