The ..., the smaller is the government purchases multiplier
What will be an ideal response?
smaller the marginal propensity to consume
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A weakening in consumer confidence causes a
A) shift of the aggregate demand curve to the right. B) movement down along the aggregate demand curve. C) shift of the aggregate demand curve to the left. D) movement up along the aggregate demand curve.
Refer to Figure 12.2. Suppose the economy is initially above potential GDP, and the actual inflation rate is greater than the expected inflation rate
If the Fed wants to achieve the goal of price stability, this would be represented by a movement on the Phillips curve from A) point A to point B. B) point C to point B. C) point B to point A. D) point A to point B to point C.
A decrease in currency in circulation combined with an equal increase in savings account deposits would: a. increase both M1 and M2
b. increase M1 but have no effect on M2. c. decrease both M1 and M2. d. decrease M1 but have no effect on M2.
The subprime mortgage bubble featured ____ leverage, and the technology stock bubble featured ____ leverage.
A. significant; significant B. significant; limited C. limited; significant D. limited; limited