Refer to the above figure. Which of the following statements is TRUE?
A. Point a is inefficient, point b is efficient and point c is unobtainable.
B. Point a is efficient, Point b is efficient, point c is inefficient.
C. Point a is unobtainable, point b is efficient and point c is inefficient.
D. All of the points are efficient.
Answer: A
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An increase in the growth rate of population in a steady-state economy would cause
A) a parallel shift upward in the investment line. B) a pivot up and to the left in the investment line. C) a pivot down and to the right in the investment line. D) a parallel shift downward in the investment line.
The Federal Reserve Board of Governors
A. serves at the pleasure of the president similar to other cabinet positions. B. reports directly to Congress and is controlled by Congress. C. consists of 12 members, one from each district bank. D. is structurally independent of the executive and legislative branches of the federal government.
In the short-run, if the Federal Reserve decreases interest rates, then consumption and investment ________, planned aggregate expenditure ________, and short-run equilibrium output ________.
A. increase; decreases; decreases B. increase; increases; decreases C. decrease; decreases; decreases D. increase; increases; increases
Contractionary fiscal policy _____
Fill in the blank(s) with the appropriate word(s).