To close an expansionary gap, the Fed ________ interest rates which ________ aggregate spending and ________ short-run equilibrium output.
A. raises; decreases; decreases
B. raises; increases; increases
C. raises; decreases; increases
D. reduces; increases; decreases
Answer: A
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If the number of people in the labor force ________, then ________
A) increases; the labor force participation rate increases B) increases; the unemployment rate definitely increases C) decreases; the unemployment rate definitely decreases D) decreases; the labor force participation rate increases E) decreases, the unemployment rate does not change
This group consists of seven members appointed by the President of the United States for 14-year terms
A) the presidents of the Federal Reserve Banks. B) the members of the Federal Open Market Committee. C) the members of the Board of Governors of the Federal Reserve System. D) None of the above answers are correct.
When the federal government gives a grant to a state or local government without restrictions on use, this is known as
A. revenue sharing. B. block grants. C. endowments. D. tax shelter.
When foreigners are making more "investments" in a country than the residents of the country are making abroad, which of the following is most likely to occur?
a. Inflation. b. Rapid growth of the money supply. c. A balance of trade deficit. d. A negative net investment rate.