Beginning from full-employment macro equilibrium, increase in ...

[SAVANNAHHOOPER23]

Beginning from full-employment macro equilibrium, increase in government spending will cause real GDP to:
 a. increase in the short run.
  b. decline in the long run.
 c. decline in the short run.
  d. increase in the long run.

Question 2

Assume all banks in the system started have a 10 percent required reserve ratio and the Fed made a 20,000 open market purchase. The result would be a(n):
 a. 200,000 expansion of the money supply.
  b. 20,000 expansion of the money supply.
  c. 20,000 contraction of the money supply.
  d. infinite contraction of the money supply.

[LP]

Answer to Question 1

a

Answer to Question 2

a

[SAVANNAHHOOPER23]

Thank you

[LP]

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