Contractionary fiscal
What will be an ideal response?
_reductions in governmentspending or transfer payments or increases in taxes, leading to alower level of economic activity
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The short-run Phillips curve shows only a short-run tradeoff between the unemployment rate and the inflation rate because in the long run the
A) expected inflation rate increases. B) unemployment rate returns to the natural unemployment rate and so there is no long-run tradeoff between the inflation rate and the unemployment rate. C) natural unemployment rate increases. D) inflation rate returns to the natural inflation rate and the unemployment rate returns to the natural unemployment rate. E) inflation rate returns to the natural inflation rate and so there is no long-run tradeoff between the inflation rate and the unemployment rate.
If a $1 million open market purchase by the Fed generates a new deposit at a bank that immediately causes the bank's reserves held at the Fed to increase by $1 million,
then the T-account effects are that the bank's assets and liabilities ________ by $1 million and that the Fed's assets and liabilities ________ by $1 million. A) decline; decline B) increase; decline C) decline; increase D) increase; increase
When banking first began, it could be said that paper money was in reality
a. worthless. b. receipts. c. government money. d. fiat money.
Which of the following would an economist classify as capital?
A. A public corporation's employees B. A share of stock C. A computer used by an accountant D. A deposit of silver