If the Fed increases the quantity of money and lowers the federal funds rate, real GDP ________ and the price level ________
A) increases; increases
B) increases; decreases
C) decreases; increases
D) decreases; decreases
E) increases; does not change
A
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Explain why deflation could prevent people from being able to repay their debts
What will be an ideal response?
If the price elasticity of demand for clothing is 0.64, this implies that
A) a 6.4 percent increase in price the price of clothing leads to a 10 percent decrease in the quantity demanded. B) a 10 percent increase in the price of clothing leads to a 6.4 percent decrease in the quantity demanded. C) if there is an increase in the price of clothing the total expenditures on clothing decreases. D) Both answers A and C are correct.
Refer to Figure 8.6, which shows just three of a firm's various possible short-run average cost curves. Which of the following statements is true?
A. The firm experiences increasing returns to scale at production levels above 130 units of output.
B. The firm experiences constant returns to scale.
C. The firm experiences increasing returns to scale up to a production level of 130 units of output.
D. The firm experiences decreasing returns to scale up to a production level of 130 units of output.
The president of each regional Federal Reserve Bank is appointed by
a. the U.S. president with the approval of the Senate. b. the Board of Governors. c. the voting members of the Federal Open Market Committee. d. the board of directors of that regional Federal Reserve Bank.