In the short run, an increase in investment, ceteris paribus, shifts the
A) AD curve to the right, causing equilibrium price level to rise and equilibrium Real GDP to increase.
B) AD curve to the left, causing equilibrium price level to fall and equilibrium Real GDP to decrease.
C) SRAS curve to the right, causing equilibrium price level to fall and equilibrium Real GDP to increase.
D) SRAS curve to the left, causing equilibrium price level to rise and equilibrium Real GDP to decrease.
A
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A country undertakes a revaluation in order to
A) decrease its net exports. B) move to a flexible exchange rate system. C) lower the value at which its currency is pegged. D) increase its net exports.
Governments sometimes erect barriers to trade other than tariffs and quotas. Which of the following is not an example of this type of trade barrier?
A) a requirement that the U.S. government buy military uniforms only from U.S. manufacturers B) a requirement that imports meet health and safety requirements C) restrictions on imports for national security reasons D) a requirement that the employees of domestic firms that engage in foreign trade pay income taxes
The Federal Reserve has been ________ preemptive because of the changing view that monetary policy has to be ________ looking
A) more; forward B) more; backward C) less; forward D) less; backward
Assume that the actual deficit is $150 billion with the economy well below potential output and that the level of economic activity rose to its potential level while tax revenues increased by $50 billion and transfer payments fell by $20 billion
Then, what is the structural deficit? a. $180 billion b. $120 billion c. $220 billion d. $80 billion e. $100 billion