The introduction of a new cost-effective production technique is likely to __
Fill in the blank(s) with the appropriate word(s).
shift the supply curve rightward
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A contract that requires the investor to sell securities on a future date is called a
A) short contract. B) long contract. C) hedge. D) micro hedge.
Potential weaknesses of nominal GDP targeting include
A) it requires accurate estimates of potential GDP growth, which are not easy to achieve. B) it implies that the central bank will respond to slowdowns in the real economy even if inflation is not falling. C) real GDP growth that is below potential or inflation that is below the inflation objective will encourage more expansionary monetary policy. D) it focuses not only on controlling inflation but also explicitly on stabilizing real GDP.
Since the U.S. economy expanded rapidly from 1992 to 2000, it must be true that
a. fiscal contraction overwhelmed monetary expansion. b. monetary expansion overwhelmed fiscal contraction. c. monetary expansion exactly offset fiscal contraction. d. monetary contraction overwhelmed fiscal expansion.
If the investment accelerator from an increase in government purchases is larger than the crowding-out effect, then
a. the multiplier is probably zero. b. the multiplier is probably equal to one. c. the multiplier is probably greater than one. d. the multiplier is probably less than one.