Suppose the Fed raises the federal funds rate. Describe the ripple effects of this monetary policy. Other short-term interest rates and the exchange rate ________. The quantity of money and supply of loanable funds ________.
Fill in the blank(s) with the appropriate word(s).
fall; increase
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Explain why the natural rate of unemployment is not equal to 0
In the basic Keynesian model, a decrease in transfer payments:
A. increases potential output. B. reduces potential output. C. reduces short-run equilibrium output. D. increases short-run equilibrium output.
Which country below has a higher GDP per capita than does the United States?
A. China B. Norway C. All three of these countries have a higher GDP per capita than does the United States. D. Sweden
An inflationary output gap is defined to be when the current level of output is:
A. high enough to cause an unexpected amount of inflation. B. below full employment GDP. C. above full employment GDP. D. equivalent to full employment GDP.