The policy mix that would cause the interest rate to decrease and investment to increase, but have an indeterminate effect on aggregate output, is a mix of
A) contractionary fiscal policy and expansionary monetary policy.
B) expansionary fiscal policy and contractionary monetary policy.
C) expansionary fiscal policy and expansionary monetary policy.
D) contractionary fiscal policy and contractionary monetary policy
Answer: A) contractionary fiscal policy and expansionary monetary policy.
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A nonmonetary opportunity cost is
A) an explicit cost. B) a direct cost. C) an implicit cost. D) an accounting cost.
Marginal cost
a. equals the slope of the total cost curve. b. is calculated as DTC/DQ. c. is the increase in total cost resulting from a one-unit increase in output. d. All of the above are correct.
A period of stagflation is the normal aftermath of a period of
a. excess aggregate supply. b. deficient aggregate demand. c. excess aggregate demand. d. high unemployment rates.
Which of the following would a permanent increase in the growth rate of the money supply change permanently?
a. inflation b. unemployment c. both inflation and unemployment d. neither inflation nor unemployment