According to the interest-rate effect, an increase in the price level will
a. increase money demand and interest rates. Investment declines.
b. increase money demand and interest rates. Investment increases.
c. increase money demand, reduce interest rates, and investment increases.
d. decrease money demand and interest rates. Investment declines.
a
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Why is the U.S. trade deficit almost always larger than the U.S. current account deficit?
What will be an ideal response?
If a firm has market power it may be able
A) to protect market share. B) to continue to earn economic profits. C) minimize marginal costs. D) to maximize total revenue.
Economic fluctuations or business cycles:
a. measure changes in the total number of new businesses started during a year b. are fluctuations in the Dow Jones industrial average relative to a long-term growth trend. c. look at the role played by business on the level of unemployment. d. are fluctuations in the level of economic activity relative to a long-term growth trend. e. are changes in government spending that occur over a period of time.
If speculation is that a recession is around the corner, which means that our future incomes will most likely fall, then the effect of all this on the economy now will be
a. an upward movement along the AD curve b. a downward movement along the AD curve c. the AD curve shift to the left d. the AD curve shift to the right e. the AS curve shift to the right