"Real business cycle" theory argues that business cycles do not, in fact, exist
Indicate whether the statement is true or false
T
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Workers and firms are currently expecting the price level to increase from 110 to 114. The Federal Reserve then announces that it will be reducing the growth rate of the money supply
If the Fed's announcement is credible, and firms and workers have rational expectations, describe how the expectations of firms and workers will be affected and how the change in expectations will affect the unemployment rate.
The amount of a product that people are willing and able to purchase at a specific price is referred to as the:
a. demand. b. quantity demanded. c. law of demand. d. consumption function. e. purchasing power.
The price elasticity of demand is usually equal to the slope of the demand curve
a. True b. False
Spending VCU4 on real-world goods and services causes the nation's:
a. Monetary base to fall. b. M2 money supply to fall. c. M2 money multiplier to fall. d. Monetary base to remain the same.