In the short run in the Keynesian model, a sharp decline in oil prices would leave the economy with a ________ level of output and a ________ real interest rate
A) higher; lower
B) lower; higher
C) lower; lower
D) higher; higher
A
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Harry Truman is credited with the statement, “Give me a one-armed economist,” because economists are likely to say, “On the one hand, . . . on the other hand.” Why do economists “waffle” more than physicists or chemists?
What will be an ideal response?
Two projects have the following NPVs and standard deviations:
Project A Project B NPV 200 300 Standard deviation 75 100 Which of the two projects is more risky?
The Japanese economy is stuck in a recessionary gap. The proper fiscal policy could include a(n)
a. decrease in taxes. b. increase in government purchases. c. increase in transfer payments. d. All of the above are correct.
If the price of inputs falls and the level of consumer indebtedness rises:
a. Price index rises, and the change in real GDP is uncertain. b. Price index falls, and real GDP rises. c. The change in price index is uncertain, and real GDP rises. d. Price index falls, and real GDP falls. e. Price index falls, and the change in real GDP is uncertain.