What are the economic effects of a currency appreciation?
A. It will decrease aggregate demand and aggregate supply, so that output will certainly fall, and prices may fall as well.
B. It will increase aggregate demand and aggregate supply, so that output will certainly rise, and prices may rise as well.
C. It will increase aggregate demand and decrease aggregate supply, so that prices will certainly rise, and output may rise as well.
D. It will decrease aggregate demand and increase aggregate supply, so that prices will certainly fall, and output may fall as well.
Answer: D
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If consumption is given by C = 300 + .6 (Y-T) and I = 300 – 40r, the IS curve is
a. Y = 600 – 2.4T – 40r + G. b. Y = 600 + .6Y -100r – G c. Y = 1500 – 1.5T – 100r + 2.5G d. Y = 1500 + .6T – 100r – G e. none of the above.
If the short-run aggregate supply curve is positively sloped and the Fed increases the money supply, aggregate demand: a. falls, which increases real GDP and the price level
b. increases, which decreases real GDP and the price level. c. falls, which decreases real GDP and increases the price level. d. increases, which decreases real GDP and increases the price level. e. increases, which increases real GDP and the price level.
The United States has a more equal income distribution than many developing economies such as Mexico, South Africa, and Brazil
a. True b. False Indicate whether the statement is true or false
The Federal Reserve Board of Governors consists of
a. seven members who serve 6-year terms b. 12 members who serve 14-year terms c. seven members who serve 4-year terms d. 12 members who serve 4-year terms e. seven members who serve 14-year terms