« previous next »

Author Question: Suppose the economy is on the classical range of the aggregate supply curve and has a problem with ... (Read 301 times)

j.rubin

  • Hero Member
  • *****
  • Posts: 557
on: Jun 30, 2018
Suppose the economy is on the classical range of the aggregate supply curve and has a problem with inflation. According to Keynesian theory, which of the following is an appropriate discretionary fiscal policy to use in this situation?
 a. A reduction in the money supply.
  b. Less government regulation.
  c. Increase federal spending.
  d. Higher taxes.

Question 2

A decrease in the money supply:
 a. raises the interest rate, causing an increase in investment and an increase in GDP.
  b. lowers the interest rate, causing an increase in investment and an increase in GDP.
  c. raises the interest rate, causing a decrease in investment and a decrease in GDP.
  d. lowers the interest rate, causing a decrease in investment and an increase in GDP.
  e. lowers the interest rate, causing a decrease in investment and a decrease in GDP.


at

  • Sr. Member
  • ****
  • Posts: 359
Reply #1 on: Jun 30, 2018
Answer to Question 1

d

Answer to Question 2

c


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

IgA antibodies protect body surfaces exposed to outside foreign substances. IgG antibodies are found in all body fluids. IgM antibodies are the first type of antibody made in response to an infection. IgE antibody levels are often high in people with allergies. IgD antibodies are found in tissues lining the abdomen and chest.

Did you know?

Only 12 hours after an egg cell is fertilized by a sperm cell, the egg cell starts to divide. As it continues to divide, it moves along the fallopian tube toward the uterus at about 1 inch per day.

Did you know?

The Centers for Disease Control and Prevention has released reports detailing the deaths of infants (younger than 1 year of age) who died after being given cold and cough medications. This underscores the importance of educating parents that children younger than 2 years of age should never be given over-the-counter cold and cough medications without consulting their physicians.

Did you know?

In 1835 it was discovered that a disease of silkworms known as muscardine could be transferred from one silkworm to another, and was caused by a fungus.

Did you know?

The first oral chemotherapy drug for colon cancer was approved by FDA in 2001.

Homer: In the Western classical tradition Homer is the author of the Iliad and the Odyssey, and is ... Homer: In the Western classical tradition Homer is the author of the Iliad and the Odyssey, and is ...
Piaget’s Three-Mountain Problem Piaget’s Three-Mountain Problem
Hockey stick” curve Hockey stick” curve
Math problem Math problem
Construct a Lorenz curve that shows income distribution in this society. Construct a Lorenz curve that shows income distribution in this society.
Problem Problem
Video: Labor and Childbirth - The Three Stages of Labor: Dilation, Expulsion & Placental مراحل الولادة

For a complete list of videos, visit our video library