Author Question: In an economy with flexible exchange rates, which measure(s) are successful at reducing unemployment ... (Read 57 times)

misspop · **on:** Jun 30, 2018

In an economy with flexible exchange rates, which measure(s) are successful at reducing unemployment in the context of the Three-Sector-Model?
a. Decrease government spending.
b. Raise the discount rate for banks.
c. Raise tax rates.
d. Reduce reserve requirements.
e. All of the above

Question 2

If you deposit 500 into a savings deposit, the immediate effect (do not consider the money multiplier which we will study in the next chapter) is:
a. M1 rises, M2 rises, and the monetary base remains the same.
b. M1, M2, and the monetary base rise.
c. M1, M2, and the monetary base fall.
d. M1, M2, and the monetary base remain the same.
e. M1 falls, M2 remains the same, and the monetary base remains the same.