A contractionary fiscal policy negates some of the leftward shift of the aggregate demand curve because the resulting fall in interest rates
A) increases the quantity of investment, raises the exchange rate and boosts net exports.
B) discourages savings, decreases the quantity of investment, raises the exchange rate, and reduces net exports.
C) increases the quantity of investment, lowers the exchange rate, and boosts net exports.
D) discourages savings, increases consumption, and reduces the quantity of investment and imports.
Ans: C) increases the quantity of investment, lowers the exchange rate, and boosts net exports.
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If the real wage decreases, the opportunity cost of working in the home will
a. increase b. decrease c. not be affected d. increase as long as worker productivity also rises e. increase only if households want to maintain their standard of living
Total revenues increase as output increases along sections of the demand curve that are:
A. downward sloping. B. price elastic. C. price inelastic. D. upward sloping.
A change in one of the many determinants of ______ or ______ leads to changes in equilibrium price and equilibrium quantity.
a. goods; services. b. demand; supply c. demand; services d. goods; supply
All of the following statements are correct EXCEPT:
A. Economies grow steadily over time. B. There are unemployed people even during expansions. C. A trade surplus exists when a country exports more than it imports. D. Unemployment increases during recessions.