In the year 2012, Shinzo Abe became prime minister of Japan, promising bold policies to improve Japan's economy. What was the focus of his policies and how did they affect Japan's trade position?
What will be an ideal response?
What has been called "Abenomics" involved monetary policies designed to reduce the value of the Japanese Yen relative to other currencies. This resulted in increased exports and reduced imports, strengthening the Japanese economy.
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The sales manager of a retail outlet suggests that the best way to increase customers is to have a sale. If a 10 percent price cut doesn’t bring in enough customers, then he’ll cut prices 20 percent. Increased cash flow should take care of profits. Do you agree? Explain.
What will be an ideal response?
Which of the following is the most accurate example of the working of the free market?
a. A government agency orders increased production of wheat bread. b. A CEO increases the production of various sport cars based on the demand for these cars in several small towns. c. The soaring demand of millions of consumers causes numerous companies to increase the supply of HD televisions. d. The increased demand for Choco Bars by people older than 80 causes the manufacturer to increase production slightly.
If the tax multiplier is -8.42, then the government purchases multiplier
A. is 9.42. B. is 8.42. C. is 1.58. D. cannot be determined because the MPS is not given.
If the government increases aggregate demand when the economy is at both short-run and long-run equilibrium, the full long-run effect of this fiscal policy will be to
A) increase real Gross Domestic Product (GDP). B) increase the price level. C) increase either the real Gross Domestic Product (GDP) or the price level, depending on the length of the time lag. D) decrease both real Gross Domestic Product (GDP) and the price level.