Author Question: Which of the following schematics most accurately represents economic fluctuations during a business ... (Read 75 times)

Jkov05 · **on:** Jun 30, 2018

Which of the following schematics most accurately represents economic fluctuations during a business cycle?

A) Shock -> Spending response by households and firms -> Multiplier effect -> Change in real GDP
B) Shock -> Multiplier effect -> Spending response by households and firms -> Change in real GDP
C) Shock -> Multiplier effect -> Change in real GDP -> Spending response by households and firms
D) Shock -> Change in real GDP -> Spending response by households and firms -> Multiplier effect

Question 2

Which of the following is NOT generally recognized as a channel for monetary policy?

A) interest rate channel
B) balance sheet channel
C) financial market channel
D) bank lending channel