Suppose the economy is producing at the natural rate of output. An open market sale of bonds by the Fed will cause ________ in real GDP in the long run and ________ in inflation in the long run, everything else held constant
A) an increase; an increase
B) a decrease; a decrease
C) no change; an increase
D) no change; a decrease
D
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Most economists view the United States' experience with trade as
a. one from which no firm conclusions about the virtues of free trade can be reached, due to the relatively short history of international trade in the U.S. b. one from which no firm conclusions about the virtues of free trade can be reached, due to the lack of trade within the U.S. throughout most of the early history of the U.S. c. an ongoing experiment that confirms the virtues of free trade. d. an ongoing experiment that calls into serious question the notion that free trade enhances the economic well-being of a nation.
If four firms comprise the entire golf club industry, the market would be
a. competitive. b. characterized by interdependence of firms. c. a duopoly. d. a monopoly.
Exhibit 11-12 A monopsonist
In Exhibit 11-12, a profit-maximizing firm faced with this labor market will hire ____ workers and pay a wage of ____.
A. 60; $35 B. 60; $25 C. 60; $27 D. 70; $30
Bankers have a reputation for conservatism in politics, dress, and business affairs. Is there an economic rationale for this conservatism? Explain.
What will be an ideal response?