Macro unit 5

Which of the following would be best to trade for long run economic growth

A rightward shift of the long run aggregate supply curve

Expansionary monetary policy may promote Long term growth that leads to

An increase in investment

The theory of rational expectations implies which of the following

Attempts to decrease unemployment through government policy will be thwarted by people's reactions

I'm just heading out effect on interest rates caused by the government deficit spending the Federal Reserve can

Buy bonds through the open market operations

An expansion our school policy will result in an increase in the interest rates unless which of the following occurs

The money supply is increased

Assume that the economy has a low unemployment rate and a high rate of them play Shin which of the following sets of monetary and fiscal policy would be consistent and designed to reduce the rate of inflation

Discount rate - increase, government spending - decrease, open market operations - sell bonds.

Which of the following monetary and fiscal policy combinations would definitely cause a decrease in aggregate demand in the short run

Discount rate - increase, government spending - decrease, open market operations - sell bonds.

When an employment rate is 4.5 and CPI is writing out of 12 percent rate the federal government raises taxes and cut government spending if the studs cell phones in the open market interest rates investment real GDP in the price of a would most likely change in which of the following ways

Interest rates would increase investment would decrease real GDP would decrease and real price level with decrease

Which of the following explains why inflation can increase

Increase in aggregate demand, decrease in aggregate supply, increasing rate of money supply growth

The Phillips curve shows the relationship between

Inflation and unemployment

In the short run combining an expansionary fiscal policy with a tight money policy is most likely to cause

Interest rates to rise

When unemployment rate is 10 percent in the CPI is rising at 2% the federal government cuts taxes increase of government spending if the Fed buys bonds on the open market interest rates investment real GDP and the price of are most likely to change in which of the following ways

Interest rates would decrease investment would increase real GDP would increase in price level would increase

Statement of the cost of producing the rate of inflation is that people must lose their jobs in the case of the speaker believes in a relationship that is usually depicted by which of the following

Lrpc

An increase in which of the following would be most likely to increase long run economic growth

Productivity

Is Congress in the Fed both wish to encourage growth of productivity capacity in an economy already close to full employment it would be most appropriate to

Reduce interest rates by engaging in open market operations and raise taxes on personal income

which of the following monetary and fiscal policy combinations would definitely cause an increase in aggregate demand

Reserve requirements - decrease, taxes - decrease, government spending - increase.

If the PPC of an economy is CD in the economy is producing at point X 1 of the following is true

Resources are not fully employed

Silver parable good last month was surprisingly high recent prices increased have pussy item more than a7 percent increase for the past year on average the producer price index has gained 1 percent each month during the last year with Ruth of increased throughout the economy would productivity gains are minimal the unemployment rate however is study at 6 percent which change in the tax rate government spending and federal funds rate are most appropriate given the state of the economy

Tax rate would increase, government spending should decrease, fed funds rate should increase

Its a production possibilities curve of an economy shifts from ab to tCD is most likely caused by

Technological advances

If the government increases spending without a tax increase and simultaneously no monetary policy changes are made which of the following would most likely occur

The rise and income may be smaller than the multiplier would predict to get the higher interest rates will crowd out private investment spending