When the Federal Reserve wishes to, in the long run, increase real GDP, it
A. will decrease the money supply by selling bonds.
B. will increase the money supply by selling bonds.
C. will increase the money supply by buying bonds.
D. has no policy options that will accomplish this.
Answer: D
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Refer to Figure 26-12. In the dynamic AD-AS model, if the economy is at point A in year 1 and is expected to go to point B in year 2, the Federal Reserve would most likely
A) not change interest rates. B) increase the inflation rate. C) increase interest rates. D) decrease interest rates.
You would expect that your firm is experiencing increasing returns to scale if
a. Long run average costs increase with output b. Long run average costs decrease with output c. Long run average costs are constant with respect to output d. None of the above
The MC curve intersects the AVC curve at the ____________ of the AVC curve.
Fill in the blank(s) with the appropriate word(s).
The Nasdaq Composite Index:
A. is made of of mainly newer, smaller firms. B. is made of mainly older firms and is heavily weighted by manufacturing. C. is a price-weighted index. D. is made up of over 5000 companies traded on the NYSE.