By shifting aggregate demand, monetary policy can affect ________ and ________.
Fill in the blank(s) with the appropriate word(s).
real gross domestic product (GDP); unemployment
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Refer to Table 2-2. According to the law of comparative advantage, both Honduras and Nicaragua could gain if
a. Honduras produced all of the apples and oranges and Nicaragua did not produce anything. b. Honduras specialized in producing apples, Nicaragua specialized in producing oranges, and they traded. c. Honduras specialized in producing oranges, Nicaragua specialized in producing apples, and they traded. d. Nicaragua and Honduras were both were self-sufficient and did not trade.
Which of the following are parts of the business cycles?
A) peak and potential GDP B) real GDP and potential GDP C) recession and expansion D) inflation and recession
According to the theory of rational expectations, the government can influence output
a. with appropriate fiscal and monetary policy. b. in the short run, but not in the long run. c. without affecting the price level. d. only by making unexpected changes in aggregate demand.
Which of the following is an equilibrium condition for the goods market in the short-run? # randomize
A. measured savings equal measured investment B. Desired savings equal desired investment C. Money demand equals money supply D. Consumption equals savings