A worldwide recession reduces the amount of U.S. exports, and as a result, aggregate demand decreases. To move U.S. GDP back to potential GDP, the Fed should
What will be an ideal response?
lower the federal funds rate
You might also like to view...
A firm in monopolistic competition has ________ demand curve
A) a downward-sloping B) an upward-sloping C) a vertical D) a horizontal E) a U-shaped
The greater the availability of close substitutes for a product, the greater the price elasticity of demand for that product
a. True b. False
In general, the costs tariffs and quotas impose on consumers are
A) large in total but relatively small per person. B) small in total but relatively large per person. C) large in total and large per person. D) small in total and small per person.
In the short run average costs eventually ________ because of diminishing returns, and in the long run average costs eventually ________ because of diseconomies of scale.
A. decrease; decrease B. decrease; increase C. increase; increase D. increase; decrease