Faced with an adverse supply shock, if the central bank wants to stabilize output, it should
A. decrease the money supply.
B. increase the money supply.
C. decrease government spending.
D. increase government spending.
Answer: B. increase the money supply.
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In the table above, what is the government's sector balance?
A) a deficit of $700 billion B) a surplus of $600 billion C) a deficit of $100 billion D) a surplus of #100 billion
The international capital market is
A) the place where you can rent earth moving equipment anywhere in the world. B) a set of arrangements by which individuals and firms exchange money now for promises to pay in the future. C) the arrangement where banks build up their capital by borrowing from the Central Bank. D) the place where emerging economies accept capital invested by banks. E) exclusively concerned with the debt crisis that ended in the 1990s.
Country A is labor abundant relative to country B if it has a larger labor force than B's
Indicate whether the statement is true or false
Economic studies have shown that countries that have high inflation rates have lower rates of economic growth than do countries with low inflation rates. Explain what underlies this relationship between inflation and economic growth
What will be an ideal response?