Starting from full employment output, fiscal policy will be completely crowded out in real terms, even with __________ LM curve, so long as prices are __________
A) a vertical; flexible
B) a vertical; fixed
C) an upward-sloping; flexible
D) an upward-sloping; fixed
C
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When the central bank buys $1,000,000 worth of government bonds from the public, the money supply:
A. increases by $1,000,000. B. decreases by $1,000,000. C. increases by less than $1,000,000. D. increases by more than $1,000,000.
Refer to the scenario above. Suppose you decide to buy a Toyota Corolla. You value the car for $10,000. You don't know it, but the car dealer values it for $8,500
If you have a zero value for poor-quality cars, what is the most that would you be willing to pay for the car? A) $3,000.50 B) $6,666.67 C) $10,000 D) $5,000
Which of the following statements is false?
A) Imports and exports account for over one-half of the GDP of the Netherlands. B) China is the leading exporting country, accounting for 10.3 percent of total world exports. C) Because the cost of labor used on farms is so high, the United States exports very little of its wheat, rice, and corn crops. D) Japan is less dependent on foreign trade than is the United States.
Explain the concept of Ricardian equivalence
What will be an ideal response?