An increase in real interest rates will increase saving and decrease aggregate demand, other things equal
a. True
b. False
Indicate whether the statement is true or false
True
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A textbook publisher is in monopolistic competition. The firm can sell no books at $100 a book, but for each $10 cut in price, the quantity of books it can sell increases by 20 books a day. The firm's total fixed cost is $2,400 a day
Its average variable cost and marginal cost is a constant $20 per book. What is the firm's maximum economic profit? A) zero B) $800 C) -$400 D) $1,000
In a two-period model, government spending is financed through
A) taxes and transfer payments. B) taxes and issuing debt. C) taxes and redeeming debt. D) taxes only.
The price index that measures the changes in prices of ALL goods and services produced by the economy is the
A. PPI. B. Gross Domestic Product (GDP) deflator. C. Personal Consumption Expenditure Index. D. CPI.
Which of the following groups typically has the highest unemployment rate?
A. Black adults. B. White adult females. C. White teenagers. D. Black teenagers.