Suppose the economy was in equilibrium, and the national government increased spending by $200 billion. Monetarist theory would predict that the main factor that will readjust the economy is the:
a. Nominal and real exchange rates.
b. Real risk-free interest rate.
c. Real wage rate.
d. Money supply.
e. Price level.
.B
You might also like to view...
All else constant, if the use of historic costs understates the opportunity costs associated with using a particular piece of capital, economic profit will be overstated
Indicate whether the statement is true or false
If a firm operates in a perfectly competitive market, then
A) all firms will advertise. B) no firms will advertise. C) the market leader will advertise. D) new firms will advertise.
The excess burden of a tax is
a. the amount by which the price of a good increases. b. the loss of consumer and producer surplus that is not transferred elsewhere. c. The amount by which a person's after-tax income decreases as a result of the new tax. d. the welfare costs to firms forced to leave the market due to an inward shift of the demand curve.
A sharp increase in gasoline prices will cause the supply curve for trucking services to shift to the right
a. True b. False Indicate whether the statement is true or false