Stagflation
a. is caused by a negative demand shock
b. is theoretically impossible
c. is a long-run phenomenon
d. was rampant during the Great Depression
e. is the combination of rising price levels and negative GDP growth
E
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The value of a dollar varies
A) inversely with the price of gold. B) inversely with the price level. C) directly with the price level. D) directly with the purchasing power of other major currencies.
In foreign exchange markets, who demands dollars and who supplies dollars?
What will be an ideal response?
Assume that business investment spending rises, and the increase is funded by greater borrowing in the capital markets. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the quantity of real loanable funds per time period and reserve-related (central bank) transactions in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period rises and reserve-related (central bank) transactions become more positive (or less negative). b. The quantity of real loanable funds per time period falls and reserve-related (central bank) transactions remain the same. c. The quantity of real loanable funds per time period and reserve-related (central bank) transactions remain the same. d. The quantity of real loanable funds per time period rises and reserve-related (central bank) transactions remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
When quantity demanded is equal to quantity supplied, we are at ___________.
Fill in the blank(s) with the appropriate word(s).