In the short run, and especially when unemployment is high, crowding in is the stronger force. The short-run effects of government’s financial rescue program and fiscal stimulus package helped the economy increase aggregate demand curing the Great Recession.
Answer the following statement true (T) or false (F)
True
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A sharp reduction in the U.S. debt-GDP ratio occurred
A) between 1998 and 2001 . B) between 1996 and 1997. C) between 1994 and 1995. D) between 1993 and 1995.
Suppose the price of gasoline and other petroleum products decline sharply. Which of the following will most likely occur as a result of the lower petroleum prices?
a. an increase in demand for solar heating systems b. an increase in demand for larger, more powerful automobiles c. an increase in demand for home insulation products d. an increase in demand for gasoline
A binding price floor creates
a. deadweight loss. b. consumer surplus. c. producer surplus. d. deadweight gain.
In a fractional-reserve banking system, an increase in reserve requirements
a. increases both the money multiplier and the money supply. b. decreases both the money multiplier and the money supply. c. increases the money multiplier, but decreases the money supply. d. decreases the money multiplier, but increases the money supply.