Author Question: In Japan, interest rates are close to zero. As a result, Keynesians would argue that money demand ... (Read 58 times)

sammy · **on:** Jun 30, 2018

In Japan, interest rates are close to zero. As a result, Keynesians would argue that money demand

a. has become much more interest rate elastic.
b. will shift upward.
c. has become much less interest rate elastic.
d. will shift downward.
e. will remain unchanged.

Question 2

Assume that the actual deficit is 150 billion with the economy well below potential output and that the level of economic activity rose to its potential level while tax revenues increased by 50 billion and transfer payments fell by 20 billion.

Then, what is the structural deficit? a. 180 billion
b. 120 billion
c. 220 billion
d. 80 billion
e. 100 billion