Economist A believes the economy is self-regulating. Economist B believes that wages and prices are inflexible downward. Economist C believes that the AS curve is vertical. Economist D believes that crowding out is likely to be complete. Which economist is most likely to advocate for expansionary fiscal policy in the in the form of greater government spending to remove an economy from a
recessionary gap?
A) Economist A
B) Economist B
C) Economist C
D) Economist D
B
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A(n) ________ in U.S. prices will cause a decrease in the demand for U.S. dollars and a(n) ________ in the (per dollar) exchange rate
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease
In the basic closed-economy ISLM model, the goods market equilibrium condition is
A) output = consumption + investment + government spending. B) output = consumption + investment + government spending - tax. C) output = consumption + investment + government spending + net export. D) output = potential output.
Suppose that a bank with no excess reserves receives a deposit into a checking account of $10,000 in currency. If the required reserve ratio is 0.20, what is the maximum amount that the bank can lend out?
A) $2,000 B) $8,000 C) $10,000 D) $50,000
Refer to the table below. If these are the only three price options for a bushel of corn, what is the value of A?
The above table provides the possible prices for a bushel of corn next year along with the associated probabilities (in percent).
A) 0.55
B) 0.45
C) 0.25
D) 0.30