At higher interest rates, fewer people or firms will want to borrow. At lower interest rates, fewer people or firms will want to save
a. True
b. False
Indicate whether the statement is true or false
True
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Macroeconomics involves the study of the decision-making of individual firms or individuals
Indicate whether the statement is true or false
Other things constant, a lowering of interest rates on used car loans would tend to
A) reduce the demand for used car loans. B) increase the demand for used car loans. C) increase the supply of used car loans. D) reduce the supply of used car loans. E) do none of the above.
Which of the following is true of the disposable income of the households?
a. An increase in the average price level lowers the disposable income of the households. b. Disposable income refers to the purchasing power of nominal income. c. An increase in direct taxes will lower the disposable income of the households. d. A decrease in government transfers will increase the disposable income of the households. e. Disposable income refers to the net private transfers of the household sector.
When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline