Homework Answers
Option C
Explanation: According to Keynes, the increase in money supply would result in a higher increase in the price level.
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please explain the reason.
10) Keynesians believe that the difference between using an increase in the...
An increase in foreign prices relative to the price level in the
An increase in foreign prices relative to the price level in the U.S. will cause: U.S. net exports to rise. US aggregate demand to fall. U.S.net exports to fallIf you are looking at a graph where a cumulative upward sloping curve plots the relationship between price level and output for suppliers, you are looking at a aggregate demand curve graph. aggregate supply curve graph. microeconomic supply graph.The economy has shifted and the quantity of the real GDP supplied has increased. What has potentially happened to aggregate...
1. Within the classical framework, explain the effects of a decline in expected profitability on investment. 2. If...
1. Within the classical framework, explain the effects of a decline in expected profitability on investment. 2. If the government decides to tighten spending by buying bonds, what are the implications for aggregate demand in the classical case? How does this differ if the government chooses to reduce spending by controlling the printing of money? 3. Within the classical model, analyze the effects of an increase in (a) lump-sum taxes; (b) marginal income tax rate. Consider effects on real output,...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the price level when the maintain full employment changes in step with the price level to O A. money wage rate OB. quantity of money OC. real wage rate OD. interest rate supplied and the when the money wage rate, the prices of other resources and Short run aggregate supply is the relationship between the quantity of potential GDP remain constant O A real GDP...
1. Modern macroeconomists tend to believe that an increase in aggregate spending A) increases real output,...
1. Modern macroeconomists tend to believe that an increase in aggregate spending A) increases real output, especially in a depressed economy with lots of excess capacity, but also increases the price level, especially in an economy with little excess capacity B) always increases real output without affecting the price level as the simplest version of the "Keynesian cross" model with a fixed price level impliesalways increases real output without affecting the price level as the simplest version of the "Keynesian...
1. When countries have severe debt problems: fiscal policy is an especially good idea. expansionary fiscal...
1. When countries have severe debt problems: fiscal policy is an especially good idea. expansionary fiscal policy can reduce real growth. it makes no difference for fiscal policy. they can continue to borrow forever without any adverse consequences. 2. Increases in government spending financed through additional borrowing will typically: lead to higher taxes. lead to higher interest rates. stimulate both consumption and investment. provide more stimulus than when government spending is financed through higher taxes. 3. In a recession, automatic...
(1) Other things being equal, which of the following will increase aggregate expenditures? Group of answer...
(1) Other things being equal, which of the following will increase aggregate expenditures? Group of answer choices An increase in domestic prices relative to foreign prices A decrease in the interest rate A decrease in real wealth An increase in income taxes A decrease in government purchases of goods and services (2) If the current unemployment rate is 5 percent and the natural unemployment rate is 6 percent, then the economy is Group of answer choices producing a level of...
Question 19 1 pts When a change in the price level leads to a change in the interest rate and thus a change in th...
Question 19 1 pts When a change in the price level leads to a change in the interest rate and thus a change in the quantity of aggregate demand, it is called theeffect. savings interest rate O price wealth o output 4 Previous Next Question 21 1 pts The Great Depression lasted longer and was deeper than the average recession, in part, because the government reduced tax rates and increased spending. the government reduced barriers to trade. there was a...
An increase in aggregate demand (AD) can cause
Question 6 An increase in aggregate demand (AD) can cause an increase in cyclical unemployment. a recession in the economy. an expansion in the economy. Question 9 Which of the following would cause a negative demand shock (shift to the left) in aggregate demand? decreased availability of business capital increased government spending production costs falling Question 10For aggregate demand and aggregate supply to be an economic model, the equilibrium aggregate price level and equilibrium aggregate real GDP should only consider long run curves. be considered in individual markets. intersect.
1.The Aggregate Supply curve shows which of the following relationships: the inverse relationship between the price...
1.The Aggregate Supply curve shows which of the following relationships: the inverse relationship between the price level and real income the positive relationship between the price level for goods and domestic output the combinations of income and the interest rate for which the demand for money equals the money supply 2.When a central bank buys long-dated government securities, it is most likely trying to do which of the following? reduce consumption and borrowing to lower inflation and growth reduce the...
3. Explain how an increase in government spending affects real interest rate, money demand and the...
3. Explain how an increase in government spending affects real interest rate, money demand and the general price level in the long run.
1. Within the classical framework, explain the effects of a decline in expected profitability on investment. 2. If the government decides to tighten spending by buying bonds, what are the implications for aggregate demand in the classical case? How does this differ if the government chooses to reduce spending by controlling the printing of money? 3. Within the classical model, analyze the effects of an increase in (a) lump-sum taxes; (b) marginal income tax rate. Consider effects on real output,...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the price level when the maintain full employment changes in step with the price level to O A. money wage rate OB. quantity of money OC. real wage rate OD. interest rate supplied and the when the money wage rate, the prices of other resources and Short run aggregate supply is the relationship between the quantity of potential GDP remain constant O A real GDP...
Question 19 1 pts When a change in the price level leads to a change in the interest rate and thus a change in the quantity of aggregate demand, it is called theeffect. savings interest rate O price wealth o output 4 Previous Next Question 21 1 pts The Great Depression lasted longer and was deeper than the average recession, in part, because the government reduced tax rates and increased spending. the government reduced barriers to trade. there was a...
3. Explain how an increase in government spending affects real interest rate, money demand and the general price level in the long run.
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