To close a recessionary gap, the Federal Reserve must ________ real interest rates by ________ the money supply.
A. decrease; increasing
B. decrease; decreasing
C. increase; decreasing
D. increase; increasing
Answer: A
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The real interest rate can be approximated by
a. adding the nominal interest rate and the inflation rate b. subtracting the nominal interest rate from the inflation rate c. adding last year's nominal interest rate to this year's d. subtracting the inflation rate from the nominal interest rate e. none of the above
Which of the following factors is least likely to affect what goods and services countries end up trading in the international market?
a. International trade tariffs b. Government debt levels c. Comparative advantages d. Differences in tastes e. Different technological needs
If in fiscal year 2015, the federal government receives $2.2 trillion in revenues and spends $3.5 trillion for goods and services, the national debt will
A. increase by $2.2 trillion. B. increase by $1.3 trillion. C. decrease by $1.3 trillion. D. decrease by $2.2 trillion.
A TRUE signal must
A. convey information about the long-run future. B. convey information only. C. explain in detail why something should be done. D. convey information and direct the resource owners to act appropriately.