When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline
B. increase; raise; decline
C. decline; lower; expand
D. decline; raise; decline
Answer: C
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An increase in the price of the cheese used to produce pizza shifts the supply curve of pizza ________ and shifts the demand curve for pizza ________
A) rightward; leftward B) leftward; leftward C) leftward; not at all D) not at all; leftward
The most effective means of stimulating the economy during a recession is for the federal government to
a. increase spending and hold taxes. b. hold government spending and decrease taxes. c. decrease government spending and hold taxes. d. decrease government spending and raise taxes.
If the R-squared value is low, then using OLS equation is very easy to predict individual future outcomes on y given a set of values for the explanatory variables.?
Answer the following statement true (T) or false (F)
In 2008, the value of the stocks listed on the New York Stock Exchange decreased tremendously. As a direct result:
A. U.S. GDP declined by the amount of the stock market decline but U.S. GNP was unaffected. B. both U.S. GDP and U.S. GNP declined by the same amount. C. neither U.S. GDP nor U.S. GNP were affected. D. U.S. GNP declined by the amount of the stock market decline but U.S. GDP was unaffected.