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A - is correct
Higher cost results in recessionary gap which can be eliminated by expansionary monetary policy.
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When costs increase and the Bank of Canada wants to return the economy to full employment,...
At full employment, an increase in the quantity of money (ceteris paribus) can start Select one:...
At full employment, an increase in the quantity of money (ceteris paribus) can start Select one: a demand-pull inflation, as can an increase in government expenditure. b. demand-pull inflation, but an increase in government expenditure cannot. C. cost-push inflation, but an increase in government expenditure cannot. d. demand-pull and a cost-push inflation, as can an increase in government expenditure. e. cost-push inflation, as can an increase in government expenditure. Safari Touch ID moodle 31.upei.ca UPEI Accessdeck Old-Moodle English (en) Suppose...
When does the supply of money increase? (1 mark) a. when the Bank of Canada increases...
When does the supply of money increase? (1 mark) a. when the Bank of Canada increases the overnight rate b. when the Bank of Canada makes open-market sales c. when the Bank of Canada makes open-market purchases d. when the Bank of Canada increases the bank rate
The graph shows an economy below full employment. To restore full employment, the government incr...
The graph shows an economy below full employment. To restore full employment, the government increases government expenditure by $0.5 trillion. Draw a curve to show the effect of the increase if it is the only change in spending plans. Label the curve ADo AE Price level (GDP price index, 2009-100) Potential GDP The increase in government expenditure sets off a multiplier process. Draw a curve that shows the multiplier effect that returns the economy to full employment. Label it AD,...
Which of the following can cause demand-pull inflation if the economy is currently in equilibrium at full-employment GDP?
Which of the following can cause demand-pull inflation if the economy is currently in equilibrium at full-employment GDP? An increase in the labour participation rate A reduction in government spending A decrease in real wages An increase in net exports An increase in the company income tax rate.
4)If the economy is at full employment, a rise in net exports causes: A) An increase...
4)If the economy is at full employment, a rise in net exports causes: A) An increase in RGDP, no change in price in the AD/AS graph. B) Increase in prices in the AD/AS model with no change in the Keynesian model C) Increase in price, no change in RGDP in the Keynesian model D)Increase in RGDP and price level in both models. E) Increases RGDP and prices in Keynesian 5) What describes the difference between Keynesian and classical thinking? A)...
[11] If an economy were to pursue a policy of maintaining full employment, it would likely...
[11] If an economy were to pursue a policy of maintaining full employment, it would likely have to forgo: A) price stability. B) full production. C) economic growth. D) maximum current output. [11A] When the inflation rate goes up, the purchasing power of money: A) increases. B) decreases. C) remains unchanged. D) remains unchanged at first and then increases. [11B] An increase in productivity occurs when: A) output per worker increases. B) a nation's rate of inflation falls. C) money...
18 19 20 C) the economy naturally self-regulates so as to attain full employment at its...
18 19 20
C) the economy naturally self-regulates so as to attain full employment at its equilibrium D) the short-run aggregate supply (SRAS) curve is always vertical. 18) In the classical model, an increase in the unemployment rate 18 A) will likely be temporary B) will result in an increase in the price level if the reduction in output is caused by a change in aggregate demand C) is a signal of demand-pull inflation. D) will persist when the reduction...
a Look at the information provided: The economy is at full employment, the inflation rate is...
a Look at the information provided: The economy is at full employment, the inflation rate is What would be the long-run effects of new government infrastructure expenditure? 2 percent a year, and the federal budget deficit is The long-run effects of new infrastructure expenditure are 3.5 percent of GDP. rate and in potential GDP. Congress wants to make real GDP grow faster and is debating whether to spend O A. rise in the interest; an increase more on infrastructure or...
Student Full Name 12. (Post) Keynesian theory of the firm: the unit direct costs (UDC) are...
Student Full Name 12. (Post) Keynesian theory of the firm: the unit direct costs (UDC) are normally a) increasing b) decreasing with respect to the level of production because firms usually operate constant c below the level of full capacity 13. In the (Post) Keynesian markup pricing (Price (1 + markup) UDC), prices are: b) market-based and demand-determined a) administered by firms and cost-determined 14. Inflation rate CPI,-CPI, a) CPI Nominal Wages c) Cost of market basket in a given...
1. If the economy is at full employment, increases in government spending: A) have a multiplier...
1. If the economy is at full employment, increases in government spending: A) have a multiplier effect on equilibrium output. B) have no effect on the aggregate price level. C) are primarily absorbed by price increases. D) reduce aggregate output. 2. Which of the following measures is NOT an example of discretionary fiscal policy? A) The unemployment compensation program pays out more money as unemployment rates rise. B) Tax rates are increased in the hope of slowing down the rate...
At full employment, an increase in the quantity of money (ceteris paribus) can start Select one: a demand-pull inflation, as can an increase in government expenditure. b. demand-pull inflation, but an increase in government expenditure cannot. C. cost-push inflation, but an increase in government expenditure cannot. d. demand-pull and a cost-push inflation, as can an increase in government expenditure. e. cost-push inflation, as can an increase in government expenditure. Safari Touch ID moodle 31.upei.ca UPEI Accessdeck Old-Moodle English (en) Suppose...
The graph shows an economy below full employment. To restore full employment, the government increases government expenditure by $0.5 trillion. Draw a curve to show the effect of the increase if it is the only change in spending plans. Label the curve ADo AE Price level (GDP price index, 2009-100) Potential GDP The increase in government expenditure sets off a multiplier process. Draw a curve that shows the multiplier effect that returns the economy to full employment. Label it AD,...
18 19 20
C) the economy naturally self-regulates so as to attain full employment at its equilibrium D) the short-run aggregate supply (SRAS) curve is always vertical. 18) In the classical model, an increase in the unemployment rate 18 A) will likely be temporary B) will result in an increase in the price level if the reduction in output is caused by a change in aggregate demand C) is a signal of demand-pull inflation. D) will persist when the reduction...
a Look at the information provided: The economy is at full employment, the inflation rate is What would be the long-run effects of new government infrastructure expenditure? 2 percent a year, and the federal budget deficit is The long-run effects of new infrastructure expenditure are 3.5 percent of GDP. rate and in potential GDP. Congress wants to make real GDP grow faster and is debating whether to spend O A. rise in the interest; an increase more on infrastructure or...
Student Full Name 12. (Post) Keynesian theory of the firm: the unit direct costs (UDC) are normally a) increasing b) decreasing with respect to the level of production because firms usually operate constant c below the level of full capacity 13. In the (Post) Keynesian markup pricing (Price (1 + markup) UDC), prices are: b) market-based and demand-determined a) administered by firms and cost-determined 14. Inflation rate CPI,-CPI, a) CPI Nominal Wages c) Cost of market basket in a given...
1. If the economy is at full employment, increases in government spending: A) have a multiplier effect on equilibrium output. B) have no effect on the aggregate price level. C) are primarily absorbed by price increases. D) reduce aggregate output. 2. Which of the following measures is NOT an example of discretionary fiscal policy? A) The unemployment compensation program pays out more money as unemployment rates rise. B) Tax rates are increased in the hope of slowing down the rate...
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