The LM curve slopes upward to the right because
A) the demand for money plus the demand for nonmoney assets must equal the supply of money plus the supply of nonmoney assets.
B) a higher real interest rate is associated with a higher level of the output gap in money market equilibrium.
C) a higher real interest rate is associated with a higher level of saving in goods market equilibrium.
D) in equilibrium the actual real interest rate must increase one-for-one with expected real interest rate.
B
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Refer to Figure 9.6. As a result of this policy, consumer surplus will
A) fall to $15. B) fall to $2250. C) rise to $2500. D) fall to $5000. E) rise to $5000.
In the above table, the fact that there is a minus sign before the number for unilateral transfers means that
A) Country X has significant inflation. B) Country X imported more goods than it exported. C) Country X received more in foreign aid than it gave in foreign aid. D) Country X gave more to foreign residents than foreign residents gave to Country X.
Which one of the following people is cyclically unemployed?
A) a Nova Scotia fishery worker who is searching for a better job closer to home B) a Saskatchewan welder who lost her job when her company relocated to B. C. and is currently looking for a job C) a steel worker who is laid off but who expects to be called back soon D) an office worker who has lost her job because of a general slowdown in economic activity E) none of the above
Part of the lag in monetary policy effects is due to
a. the long political process of monetary policy decisions. b. precise economic forecasts. c. the time required for firms and households to alter their spending plans. d. changes in the unemployment rate.