Suppose an increase in interest rates causes rising unemployment and falling output. To counter this, the Federal Reserve would
a. increase government spending.
b. increase the money supply.
c. decrease government spending.
d. decrease the money supply.
b
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If there are approximately 5,000 barrels of known reserves of oil, an estimated 7,500 barrels of unknown reserves of oil,
and annual consumption is 500 barrels of oil, approximately how many years will it be until the supply of oil is depleted, all else equal? A) 5 B) 10 C) 15 D) 25
A $130,000 investment in new equipment this year will increase your firm's profits by $50,000 in each of the next 3 years. What is the net present value of this investment if your firm's opportunity cost of capital is 10 percent?
A) -5,657 B) 5,657 C) 124,343 D) 128,850
Government intervention in the farm economy that aims to create for farmers a constant or near constant level of purchasing power is called
a. partial rationing b. parity pricing c. income allotments d. price ceilings e. deficiency subsidization
In the case of a technology spillover, internalizing a positive externality will cause the supply curve of an industry to
a. shift to the right. b. shift to the left. c. become more elastic. d. remain unchanged.