Keynes believed that contractionary fiscal policy could help to slow down increases in unemployment.
Answer the following statement true (T) or false (F)
False
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Aggregate expenditure is equal to
A) C - I - G - NX. B) Y + C + I + G + NX. C) C + I + G - NX. D) C + I + G. E) C + I + G + NX.
In developed industries, the interest rate tends to be lower than in newer industries. What could explain this?
A) greater demand for loans in the developed industry B) greater supply for loans in the new industry C) greater demand for loans in the new industry D) lower supply for loans in the developed industry
An increase in government spending leads to a(n)
a. downward shift of the aggregate expenditure line and a leftward shift of the money demand curve b. upward shift of the aggregate expenditure line and a rightward shift of the money demand curve c. downward shift of the aggregate expenditure line and a rightward shift of the money demand curve d. upward shift of the aggregate expenditure line and a leftward shift of the money demand curve e. upward shift of the aggregate expenditure line but no shift of the money demand curve
If the money supply curve is vertical, an increase in bond interest rates
A) is likely to cause banks to supply more money. B) is likely to cause banks to supply less money. C) has no effect on the money supply. D) is likely to cause the Federal Reserve to increase the money supply.