Expansionary monetary policy results in a shift of the aggregate demand curve to the right. The effect of the monetary policy on the aggregate demand is:
A. direct from the money supply to the aggregate demand.
B. indirect through the short-term and long-term interest rates.
C. indirect through the government expenditures.
D. direct from the money supply to the aggregate supply.
Answer: B
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Suppose that government spending increases, shifting up the aggregate expenditure line. GDP increases from GDP 1 to GDP 2, and this amount is $400 billion. If the MPC is 0.75, then what is the distance between N and L or by how much did government spending change?
A) $10 billion B) $100 billion C) $200 billion D) $300 billion
Describe the provisions of the Sherman Act
What will be an ideal response?
Pretty Polly produces dresses for little girls. When Pretty Polly's manager sets the change in ________ profit equal to its marginal cost of advertising, Pretty Polly's ________ profit is maximized.
A) net; gross B) gross; net C) net; net D) gross; gross
It is impossible to conduct ________ policy and maintain a ________ exchange rate.
A. monetary; floating B. fiscal; fixed C. monetary; fixed D. fiscal; floating