Which of the following is most likely to lead to a decrease of 10% in the nominal demand for money?
A) An increase in real income of 5%
B) A decrease in real income of 5%
C) A decline of 10% in the price level
D) An increase of 10% in the price level
C
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Expansionary fiscal policy uses ________ government spending and ________ taxes to increase aggregate economic activity
A) lower; lower B) higher; lower C) higher; higher D) lower; higher
A decrease in efficiency would shift the long-run aggregate supply curve:
A) rightward. B) leftward. C) no shift. D) none of the above.
The circular-flow diagram is a
a. visual model of the economy. b. visual model of the relationships among money, prices, and businesses. c. model that shows the effects of government on the economy. d. mathematical model of how the economy works.
Money is destroyed when
A. a bank gives you a $1,000 loan. B. you pay back a $1,000 loan to a bank. C. you deposit $1,000 cash to be deposited in your checking account. D. you cash a check for $1,000 at your bank.