An increase in interest rates by banks is an example of a monetary policy
a. True
b. False
Indicate whether the statement is true or false
True
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If the price of rubber (an input to the production of tires) increases:
A. the supply of tires will decrease. B. the demand for tires will decrease C. the demand for tires will increase. D. the supply of tires will increase.
Credibility in threats and commitments in sequential games is based on
a. randomizing one's actions so they are unpredictable b. explicit communications with competitors c. effective scenario planning d. analyzing best reply responses e. none of the above
The equation of exchange can be stated as M = (V x P)/Y
a. true b. false
The self-correcting tendency of the economy means that falling inflation eventually eliminates:
A. exogenous spending. B. recessionary gaps. C. expansionary gaps. D. unemployment.