Recessionary gap arises when
a. inventory stock falls.
b. government spending increases.
c. when the general price level increases.
d. there is less spending than desired.
d
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When the Fed engages in an open market purchase, the money supply ________ and the nominal interest rate ________.
A. increases; increases B. decreases; increases D decreases; decreases C. increases; decreases
When the domestic price level increases, exports decrease and imports increase. Other things the same, this change is illustrated by a
A) movement upward along the aggregate demand curve. B) movement downward along the aggregate demand curve. C) rightward shift of the aggregate demand curve. D) leftward shift of the aggregate demand curve. E) rightward shift of the aggregate supply curve.
Which of the following represents the general rule of hiring for a firm?
A. Average revenue product equals the wage rate. B. Total physical product equals marginal factor cost. C. Marginal cost equals marginal revenue. D. Marginal revenue product equals marginal factor cost.
Refer to the information provided in Figure 25.2 below to answer the question(s) that follow.
Figure 25.2Refer to Figure 25.2. Suppose the money demand is currently at Point B. A movement to Point A could be caused by
A. a decrease in nominal income. B. an increase in the interest rate. C. an increase in nominal income. D. a decrease in the interest rate.