When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand
B. increase; raise; decline
C. decline; lower; decline
D. decline; raise; decline
Answer: B
You might also like to view...
The area below the demand curve and above the price line measures
A) consumer surplus. B) economic profit. C) elasticity of demand. D) the total value obtained from consuming the good or service.
The table below shows the pre-tariff and post-tariff prices, domestic production, and consumption of copper in the United States. Suppose the U.S. government imposes a specific tariff of $0.20 per pound on copper imports by the country. Pre-tariffPost-tariffWorld price$0.50 per lb.$0.40 per lb.U.S domestic price$0.50 per lb.$0.60 per lb.U.S consumption250 million lb.210 million lb.U.S production100 million lb.140 million lb. a. Calculate the loss to U.S. consumers of copper from the tariff.b. Calculate the gain to U.S. producers of copper from the tariff.c. Calculate the revenue collected by the U.S. government from taxing copper imports.d. Calculate the net gain or loss to the U.S. economy as a whole from the tariff.
What will be an ideal response?
How much is induced consumption when disposable income is $400 billion?
What is the link between the safety net provided by the government to the financial industry and the relatively heavy regulation of the same industry by the government?
What will be an ideal response?