Which of the following could contribute to cost-push inflation?
a. Greater demand for exports
b. Lower income taxes
c. An increase in consumption demand
d. Higher government spending
e. Higher wage demands by trade unions
e
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Assuming that banks have loaned all excess reserves, then an increase in checking account balances brought about by an increase in deposits is equal to
A) (the initial deposit) × (the reserve ratio). B) (total reserves) × ( the reserve ratio). C) (the initial deposit) × (1 / reserve ratio). D) (total reserves) × (1 / reserve ratio).
In a perfectly competitive market, a technological advance allows all firms to earn higher economic profits in the long run
a. True. b. False.
The shortsightedness effect suggests that
A) politicians have a strong incentive to support projects that yield benefits in the distant future, especially when the costs of the project must be paid for in the current period. B) politicians have a strong incentive to support projects that yield immediate and easily recognized benefits, especially when the costs of the projects are difficult to identify and are observable only in the distant future. C) legislators will be unwilling to trade votes on issues, especially when those issues benefit only special interest groups. D) voters will tend to weigh future costs and benefits more heavily than current costs and benefits.
Injections include
A. Consumer saving. B. Taxes. C. Business saving. D. Exports.