Suppose that data for a particular economy over time suggest that its aggregate demand curve is both steep and shifts frequently. We might reasonably infer that ________
A) the central bank has an activist emphasis on the stability of economic activity
B) wages and prices are remarkably flexible
C) policy lags are quite long
D) all of the above
E) none of the above
A
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Savers have less incentive to care what their bank is doing with their money because their deposits are federally insured. This is a problem of
a. nominal interest b. adverse selection c. moral hazard d. the winner's curse e. a positive externality
Planned investment expenditures will eventually decrease after: a. the money supply decreases
b. the demand for money decreases. c. the interest rate falls. d. the Fed buys government securities. e. business managers become more optimistic about future market conditions for their products.
According to the open-economy macroeconomic model, if the United States moved from a government budget deficit to a government budget surplus, U.S. real interest rates would increase and the real exchange rate of the U.S. dollar would appreciate
a. True b. False Indicate whether the statement is true or false
________ is determined by the world demand for and the world supply of the good
a. Tariff b. World price c. Exchange rate d. Terms of trade