During the Great Depression, real GDP decreased by roughly ____ percent and unemployment rose to roughly ____ percent
a. 5; 10
b. 20; 10
c. 30;25
d. 50;25
c. 30;25
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Imagine that you borrow $5,000 for one year and at the end of the year you repay the $5,000 plus $600 of interest. If the inflation rate was 4%, what was the real interest rate you paid?
A) 16 percent B) 12 percent C) 8 percent D) 6 percent
During the 1930s, banks found it hard to solve the asymmetric information problem between borrowers and lenders, because ____
a. Many borrowers lacked adequate collateral b. Changing federal bank regulations created uncertainty c. The fall in the stock of money reduced aggregate demand d. Interest rates had fallen to "liquidity trap" levels
Refer to the accompanying figure.
This firm's marginal revenue curve would intersect the vertical axis at ________.
A. $20 B. $0 C. $35 D. $70
Figure 10-6
Given the aggregate demand and aggregate supply curves for the economy depicted in , the economy's current output and price level are
a.
output y1 and price level P2.
b.
output y2 and price level P1.
c.
output y1 and price level P3.
d.
output y2 and price level P3.