Homework Answers
Which of the following is not correct ?
Answer - (C) The fed makes loans to any qualified business that requests one
Reason - The Fed approves loans only to other commercial banks, rather than any business.
Question 56
Answer - (C) An inflationary gap occurs when potential output exceeds actual output
Reason - It happens when actual GDP exceeds potential GDP.
Question 57
Answer - (C)Full employment simply means that there is no cyclical unemployment
Reason - Full employment is the case where there is no cyclical unemployment. Hence , there is enough demand for anyone who is seeking an employment to have a job.
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Which of the following statements is not correct? A. The Fed was created in 1913 to...
When easy money policy is used persistently by the Fed, it eventually results in: reduced unemployment....
When easy money policy is used persistently by the Fed, it eventually results in: reduced unemployment. excessive savings. high inflation. the exhaustion of excess reserves. In 2016, Greece faced another set of hurdles in its ongoing saga of managing its debt. In order for Greece to maintain its obligations under the IMF and European Central Bank bailout packages, it must continue to cut government spending, particularly pensions that have put a strain on the budget. Greece's leaders, meanwhile, have argued...
Check my answers please ?? MULTIPLE CHOICE. Choose the one alternative that best completes the statement...
Check my answers please ??
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) 1) The use of government taxes and spending to alter economic outcomes is known as A) Incomes policy Q) Monetary policy B) Foreign trade policy. D) Fiscal policy A- 2) 2) If full-employment output exceeds equilibrium output, greater deficit spending will result A) Smaller recessionary gap C) Smaller inflationary gap. B) Larger recessionary gap. D) None of the choices...
Fill in the blanks to make the following statements correct:(options are in the brackets) Beginning with...
Fill in the blanks to make the following statements correct:(options are in the brackets) Beginning with output equal to potential, suppose there is a drop in business confidence and investment falls. This is a____ (supply/demand) shock to the Canadian economy, which shifts the__ (AD/AS) curve to the___ (right/left) and creates ____ (a recessionary/ an inflationary) gap. Units costs will start to___(rise/fall) and the__ (AD/AS) curve will shift ____ (rightward/leftward) . Long-run equilibrium will (slowly) be restored at ___ (actual/potential)output and...
Unit 3: Aggregate Demand, Aggregate Supply, and Fiscal Policy AD, AS, and LRAS Short Run vs....
Unit 3: Aggregate Demand, Aggregate Supply, and Fiscal Policy AD, AS, and LRAS Short Run vs. Long Run Aggregate Supply Draw the economy at full employment 1. In the short run, wages and resource prices will as price levels increase 2. In the long run, wages and resource prices will as price levels increase Shifters of AD and AS Shifters of Aggregate Demand Shifters of Aggregate Supply imi Recessionary Gap Draw an economy in a recession Inflationary Gap Draw an...
24) Great Recession and Great Depression were similar except Stock Market crash High U...
24) Great Recession and Great Depression were similar except Stock Market crash High Unemployment Bad loans by banks Role of the Fed 25) The various kinds of automatic stabilizers are: Increased Defense spending All of them Expansionary Monetary Policy Taxes and Transfer payments 29) Internet Revolution in the 1990’s was an example of Negative Supply shock Positive demand shock Negative Demand shock Positive Supply shock 33) To close a recessionary gap, the Fed would increase the money supply increase interest...
24) Great Recession and Great Depression were similar except Stock Market crash High Unemployment Bad loans...
24) Great Recession and Great Depression were similar except Stock Market crash High Unemployment Bad loans by banks Role of the Fed 25) The various kinds of automatic stabilizers are: Increased Defense spending All of them Expansionary Monetary Policy Taxes and Transfer payments 29) Internet Revolution in the 1990’s was an example of Negative Supply shock Positive demand shock Negative Demand shock Positive Supply shock 33) To close a recessionary gap, the Fed would increase the money supply increase interest...
6. (Problem 6) An economy is facing the inflationary gap shown in the accompanying diagram. Aggregate...
6. (Problem 6) An economy is facing the inflationary gap shown in the accompanying diagram. Aggregate price level LRAS SRAS Real GDP Potential —YpY output To eliminate the gap, should the central bank use expansionary or contractionary monetary policy? How will the interest rate, investment spending, consumer spending, real GDP, and the aggregate price level change as monetary policy closes the inflationary gap? The central bank can use contractionary monetary policy. The interest rate will rise, which would encourage a...
1. Is the Phillips curve a myth? Intertemporal tradeoff between inflation and unemployment After the World...
1. Is the Phillips curve a myth? Intertemporal tradeoff between inflation and unemployment After the World War II, empirical economists noticed that, in many advanced economies, as unemployment fell, inflation tended to rise, and vice versa. The inverse relationship between unemployment and Inflation, was depicted as the Phillips curve, after William Phillips of the London School of Economics. In the 1950s and 1960s, the Phillips curve convinced many policy makers that they could use the relationship to pick acceptable levels...
Question 19 (2.8 points) If GDP>LRAS, it is called which of the following? O natural rate...
Question 19 (2.8 points) If GDP>LRAS, it is called which of the following? O natural rate of unemployment full employment O recessionary gap expansionary gap Question 20 (2.8 points) The use of Government spending and taxes to affect the economy is called O classical economics O progressive income tax fiscal policy stagflation
QUESTION 24 Given the table below which of the following statements is TRUE? Consumption Savings MPC...
QUESTION 24 Given the table below which of the following statements is TRUE? Consumption Savings MPC MPS APC APS Level of output 240 -4 260 0 280 4 300 8 320 12 16 340 360 20 380 24 400 28 A. Equilibrium is obtained when the level of output is 280 When the level of output is 320 APS is equal to 0,375 C. When the level of output is 360 APC is 0.94 D. When the level of output...
Check my answers please ??
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) 1) The use of government taxes and spending to alter economic outcomes is known as A) Incomes policy Q) Monetary policy B) Foreign trade policy. D) Fiscal policy A- 2) 2) If full-employment output exceeds equilibrium output, greater deficit spending will result A) Smaller recessionary gap C) Smaller inflationary gap. B) Larger recessionary gap. D) None of the choices...
Unit 3: Aggregate Demand, Aggregate Supply, and Fiscal Policy AD, AS, and LRAS Short Run vs. Long Run Aggregate Supply Draw the economy at full employment 1. In the short run, wages and resource prices will as price levels increase 2. In the long run, wages and resource prices will as price levels increase Shifters of AD and AS Shifters of Aggregate Demand Shifters of Aggregate Supply imi Recessionary Gap Draw an economy in a recession Inflationary Gap Draw an...
6. (Problem 6) An economy is facing the inflationary gap shown in the accompanying diagram. Aggregate price level LRAS SRAS Real GDP Potential —YpY output To eliminate the gap, should the central bank use expansionary or contractionary monetary policy? How will the interest rate, investment spending, consumer spending, real GDP, and the aggregate price level change as monetary policy closes the inflationary gap? The central bank can use contractionary monetary policy. The interest rate will rise, which would encourage a...
1. Is the Phillips curve a myth? Intertemporal tradeoff between inflation and unemployment After the World War II, empirical economists noticed that, in many advanced economies, as unemployment fell, inflation tended to rise, and vice versa. The inverse relationship between unemployment and Inflation, was depicted as the Phillips curve, after William Phillips of the London School of Economics. In the 1950s and 1960s, the Phillips curve convinced many policy makers that they could use the relationship to pick acceptable levels...
Question 19 (2.8 points) If GDP>LRAS, it is called which of the following? O natural rate of unemployment full employment O recessionary gap expansionary gap Question 20 (2.8 points) The use of Government spending and taxes to affect the economy is called O classical economics O progressive income tax fiscal policy stagflation
QUESTION 24 Given the table below which of the following statements is TRUE? Consumption Savings MPC MPS APC APS Level of output 240 -4 260 0 280 4 300 8 320 12 16 340 360 20 380 24 400 28 A. Equilibrium is obtained when the level of output is 280 When the level of output is 320 APS is equal to 0,375 C. When the level of output is 360 APC is 0.94 D. When the level of output...
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