The housing market crash that accompanied the 2007-2009 recession has had severe negative effects on the U.S. economy. Since December 2008, the target federal funds rate has been 0.0-0.25%
Assuming the Fed keeps the real interest rate constant, a recovery in the housing market would cause the ________, and the output gap would ________. A) MP curve to shift up; become less negative
B) MP curve to shift down; become more negative
C) IS curve to shift to the left; become more negative
D) IS curve to shift to the right; become less negative
D
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Use the following table to answer the next question.YearNominal Income (dollars)CPIReal Income (dollars)1$44,600130 2$48,200 $35,1833$51,000139 What is the value of the CPI in Year 2?
A. 137 B. 1.37 C. 73 D. 0.73
The above table depicts prices, quantities, and marginal costs faced by the campus bookstore. Based on marginal analysis, what is the profit-maximizing level of output for the bookstore?
A) 1 book B) 2 books C) 3 books D) 4 books
The marginal rate of technical substitution (RTS) of labor for capital measures:
a. the amount by which capital input can be reduced while holding quantity produced constant when one more unit of labor is used. b. the amount by which labor input can be reduced while holding quantity produced constant when one more unit of capital is used. c. the ratio of total labor to total capital. d. the ratio of total capital to total labor.
The number of cattle slaughtered every year for meat far exceeds the number of elephants slaughtered every year for their ivory. Despite this, cows can be found everywhere while elephants are on the verge of extinction in some countries. Which of the following best explains this difference?
a. Cows can be privately owned while in many countries elephants can not. b. The demand for ivory far exceeds the demand for beef. c. Animals slaughtered for their meat are generally better conserved by humans than animals slaughtered for nonfood uses. d. People tend to protest more every year to prevent cow extinction than they do for elephant extinction.