During business cycle expansions when income and wealth are rising, the demand for bonds ________ and the demand curve shifts to the ________, everything else held constant
A) falls; right
B) falls; left
C) rises; right
D) rises; left
C
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When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline
As monetarists view the equation of exchange:
A. V changes erratically and unpredictably. B. V is quite stable. C. V usually changes in the same direction of any given change in M. D. V usually changes in the opposite direction of any given change in M.
A tax on gasoline often reduces road congestion because gasoline
a. and driving are complements. b. and driving are substitutes. c. is a normal good, while driving is an inferior good. d. is an inferior good, while driving is a normal good.
According to some economists, what contributed to the unusual uncertainty that adversely affected aggregate supply during the recovery following the recession of 2007-2009?
What will be an ideal response?