Refer to Figure 10.9. Other things equal, an increase in the nominal money supply by the Fed is best represented as a change in equilibrium from
A) point A to point B.
B) point A to point D.
C) point C to point B.
D) point C to point D.
B
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GDP measured using current prices is called ________.
A. real GDP B. deflated GDP C. nominal GDP D. constant GDP
Which of the following may be explained by adverse selection?
a. When banks raise the interest rate on loans, high-risk applicants leave the market. b. When health insurance companies decrease insurance charges but increase deductibles, less healthy people are more willing to purchase insurance. c. As the cost of insurance rises, low-risk applicants reduce their coverage. d. Products are sold at prices that reflect their true value. e. Loan companies do not require down payments.
Government outlays
a. are the same as "G" in the short-run macro model. b. do not include transfer payments. c. are always smaller than government purchases. d. are always greater than government purchases. e. tend to decline in the long run.
In less developed economies more economic activity is "do-it-yourself"
Indicate whether the statement is true or false