When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand
B. increase; raise; decline
C. decline; lower; decline
D. decline; raise; decline
Answer: B
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If the annual interest rate is 0%, the net present value of receiving $550 in the next year is:
a. $550 b. $551. c. $549 d. $500
If a firm wished to maximize total revenues it should produce where
a. marginal cost is zero. b. marginal revenue is zero. c. marginal revenue is equal to marginal cost. d. marginal revenue is equal to price.
In 2012, the United States:
A. imported more services than it exported. B. imported more goods than it exported. C. traded mainly with developing nations such as Mexico and India. D. had a small trade surplus in goods and services.
For the demand curves of baby formula. Which of the following changes is likely to happen if the price of baby formula decreases?
a. a movement along the demand curve D1 from point a to point b
b. a shift of the demand curve from D2 to D1
c. a movement along the demand curve D2 from point d to point c
d. a movement from point b on the demand curve D1 to point c on the demand curve D2
e. a shift of the demand curve from D1 to D2