econ

If the value of the United States dollar increases on the foreign exchange market, which of the following is most likely to occur in the short run?

(A) Aggregate demand will decrease.

Public policy that generates an unexpected increase in consumer prices will inflict short-run costs on all of the following EXCEPT

(A) borrowers

An increase in net investment leads to faster economic growth because capital per worker and output per worker will change in which of the following ways?

(A) capital per worker increase, output per worker increase

Which of the following best explains the increase in national income that results from equal increases in government spending and taxes?

(A) consumers do not reduce their spending by the full amount of the tax increase

A reduction in inflation can best be achieved by which of the following combinations of fiscal and monetary policy?

(A) increase taxes, sell government bonds

If aggregate demand is growing faster than long-run aggregate supply, the Federal Reserve is most likely to

(A) sell securities on the open market

An increase in the price level will most likely cause which of the following?

(B) an increase in the demand for money

A barter economy is different from a money economy in that a barter economy

(B) involves higher costs for each transaction

In the short run, government deficit spending will most likely

(C) raise nominal interest rates

An increase in the government budget deficit is most likely to result in an increase in which of the following?

(C) the real interest rate

Which of the following statements is true of unanticipated inflation?

(D) it increases the economic well-being of net debtors

Which of the following is true of the opportunity cost of holding cash?

(E) it increases as the interest rate rises