If the Federal Reserve increases the money supply at the same time as an expansionary fiscal policy drives up budget deficits, we would expect to see income _____ and interest rates ____
a. changes be indeterminate; fall
b. fall; fall
c. rise; fall.
d. rise; changes be indeterminate
e. none of the above.
C
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According to the ____ view, a nation’s wealth consists of the amount of gold or other monies at its command.
A. Keynesian B. free trade C. mercantilist D. monetarist
Inferior goods typically obey the law of demand because the substitution effect tends to dominate the income effect
a. True b. False
To be a natural monopoly, a firm must
A. control an essential natural resource input. B. be very large. C. have a continuously falling average cost curve as output rises. D. have falling average costs over a substantial range of total market demand.
The view that individuals weigh all available evidence when they formulate their expectations about economic events (including information concerning the probable effects of current and future economic policy) is called:
A. the adaptive expectations hypothesis. B. the permanent income hypothesis. C. the rational expectations hypothesis. D. the Phillips curve.