Author Question: Economists agree that the multiplier effect on real output is close to zero when: a. inflation is ... (Read 28 times)

ishan

  • Hero Member
  • *****
  • Posts: 546
Economists agree that the multiplier effect on real output is close to zero when:
 a. inflation is very low.
 b. the economy is at or near full employment.
  c. the national debt is relatively small.
 d. shovel-ready projects exist.

Question 2

Suppose that the Fed decides to decrease the money supply by 0.87 percent. If the velocity of money is constant, then the quantity theory of money predicts that:
 a. nominal GDP will remain unchanged.
  b. the quantity of output will rise by 0.87 percent.
  c. nominal GDP will fall by 0.87 percent.
  d. the price level will fall by 0.87 percent.
  e. real GDP will fall by 0.87 percent.



SVictor

  • Sr. Member
  • ****
  • Posts: 365
Answer to Question 1

b

Answer to Question 2

c



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

Individuals are never “cured” of addictions. Instead, they learn how to manage their disease to lead healthy, balanced lives.

Did you know?

If you use artificial sweeteners, such as cyclamates, your eyes may be more sensitive to light. Other factors that will make your eyes more sensitive to light include use of antibiotics, oral contraceptives, hypertension medications, diuretics, and antidiabetic medications.

Did you know?

The heart is located in the center of the chest, with part of it tipped slightly so that it taps against the left side of the chest.

Did you know?

Tobacco depletes the body of vitamins A, C, and E, which can result in any of the following: dry hair, dry skin, dry eyes, poor growth, night blindness, abscesses, insomnia, fatigue, reproductive system problems, sinusitis, pneumonia, frequent respiratory problems, skin disorders, weight loss, rickets, osteomalacia, nervousness, muscle spasms, leg cramps, extremity numbness, bone malformations, decayed teeth, difficulty in walking, irritability, restlessness, profuse sweating, increased uric acid (gout), joint damage, damaged red blood cells, destruction of nerves, infertility, miscarriage, and many types of cancer.

Did you know?

Barbituric acid, the base material of barbiturates, was first synthesized in 1863 by Adolph von Bayer. His company later went on to synthesize aspirin for the first time, and Bayer aspirin is still a popular brand today.

For a complete list of videos, visit our video library