Author Question: The Fed will raise the interest rate by the greatest amount when the economy is on the ________ part ... (Read 34 times)

aabwk4 · **on:** Apr 19, 2019

Question 1

If the economy is on the steep portion of the
AS curve

◦ there is little crowding out of planned investment.
◦ there is almost complete crowding out of planned investment.
◦ consumption, but not government spending, crowds out planned investment.
◦ government spending, but not consumption, crowds out planned investment.

Question 2

The Fed will raise the interest rate by the greatest amount when the economy is on the ________ part of the
AS curve and there is ________.

◦ flat; a decrease in government spending
◦ flat; an increase in government spending
◦ steep; a decrease in government spending
◦ steep; an increase in government spending

tsternbergh47 · **Reply #1 on:** Apr 19, 2019

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