Keynesian economists believe that fiscal and monetary policies are necessary to offset
A. changes in the price of gold.
B. the difference between imports and exchange rates.
C. the inherent instability of the private sector.
D. the growth of monopoly business and labor unions.
C. the inherent instability of the private sector.
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When people make rational choices, they
A) do not consider their emotions. B) weigh the costs and benefits of their options and act to satisfy their wants. C) are necessarily making the best decision. D) necessarily make a decision in the social interest. E) behave selfishly.
Suppose Bank A holds $200 of reserves, has deposits of $1000, and the desired reserve ratio is 15 percent. How many loans can Bank A create at Bank A?
A) zero, because Bank A has no excess reserves B) $200 C) $50 D) $850
What is the best way to describe aggregate demand?
A) quantity required to satisfy equilibrium B) exports decrease; imports increase C) amount of a country's goods and services demanded by household and firms throughout the world D) individual's demand E) domestic demand of foreign imports.
When the price of a bond is ________ the equilibrium price, there is an excess demand for bonds and price will ________
A) above; rise B) above; fall C) below; fall D) below; rise