What usually happens after an adverse supply shock?
What will be an ideal response?
Prices rise and output falls.
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The anticipated effect of contractionary monetary policy is
a. increase in aggregate demand. b. fall in interest rates. c. increased capital outflow. d. appreciation of the currency.
Rent controls tend to _____ the housing supply and to _____ the rents that people in non-rent-controlled apartments pay.
Fill in the blank(s) with the appropriate word(s).
Stock prices often rise when the Fed raises interest rates
a. True b. False Indicate whether the statement is true or false
Which of the following explains why flood control is a public good?
A. There are external benefits associated with its consumption. B. Flood control is paid for by taxpayers. C. It is not divisible and therefore cannot be kept from people who do not pay. D. The private sector usually produces flood control projects.