Everything else remaining unchanged, what is likely to happen to the equilibrium real interest rate and quantity of credit if the credit demand curve shifts to the left?
A) Both equilibrium rate of interest and quantity of credit will decrease.
B) Both equilibrium rate of interest and quantity of credit will increase.
C) The equilibrium rate of interest will decrease and the quantity of credit will increase.
D) The equilibrium rate of interest will increase and the quantity of credit will decrease.
A
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Which of the following is not a valid criticism of discretionary fiscal policy? a. The implementation of fiscal policy is sometimes difficult
b. Time lags in fiscal policy are long. c. Fiscal policy works only during periods of stagflation. d. Fiscal policy often affects only current income, but many economic decisions are made on the basis of permanent income. e. Fiscal policy might have undesirable long-term effects on aggregate supply.
The flour used in the pizza you bought for dinner last night is considered a final good
a. True b. False Indicate whether the statement is true or false
Which of the following scenarios is consistent with the Laffer curve?
a. The tax rate is 1 percent, and tax revenue is very low. b. The tax rate is 1 percent, and tax revenue is very high. c. The tax rate is 99 percent, and tax revenue is very high. d. The tax rate is moderate (between very high and very low), and tax revenue is very low.
If the economy moves into recession, monetarists argue that the Fed should
A. Keep the money supply growing at a constant rate B. Keep the money supply fixed C. Increased the federal funds rate