« previous next »

Author Question: Suppose the economy is on the classical range of the aggregate supply curve and has a problem with ... (Read 294 times)

j.rubin

  • Hero Member
  • *****
  • Posts: 557
on: Jun 30, 2018
Suppose the economy is on the classical range of the aggregate supply curve and has a problem with inflation. According to Keynesian theory, which of the following is an appropriate discretionary fiscal policy to use in this situation?
 a. A reduction in the money supply.
  b. Less government regulation.
  c. Increase federal spending.
  d. Higher taxes.

Question 2

A decrease in the money supply:
 a. raises the interest rate, causing an increase in investment and an increase in GDP.
  b. lowers the interest rate, causing an increase in investment and an increase in GDP.
  c. raises the interest rate, causing a decrease in investment and a decrease in GDP.
  d. lowers the interest rate, causing a decrease in investment and an increase in GDP.
  e. lowers the interest rate, causing a decrease in investment and a decrease in GDP.


at

  • Sr. Member
  • ****
  • Posts: 359
Reply #1 on: Jun 30, 2018
Answer to Question 1

d

Answer to Question 2

c


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Walt Disney helped combat malaria by making an animated film in 1943 called The Winged Scourge. This short film starred the seven dwarfs and taught children that mosquitos transmit malaria, which is a very bad disease. It advocated the killing of mosquitos to stop the disease.

Did you know?

The FDA recognizes 118 routes of administration.

Did you know?

Anesthesia awareness is a potentially disturbing adverse effect wherein patients who have been paralyzed with muscle relaxants may awaken. They may be aware of their surroundings but unable to communicate or move. Neurologic monitoring equipment that helps to more closely check the patient's anesthesia stages is now available to avoid the occurrence of anesthesia awareness.

Did you know?

Patients who have undergone chemotherapy for the treatment of cancer often complain of a lack of mental focus; memory loss; and a general diminution in abilities such as multitasking, attention span, and general mental agility.

Did you know?

According to the FDA, adverse drug events harmed or killed approximately 1,200,000 people in the United States in the year 2015.

Range of Motion of the Cervical Spine, Rotation Range of Motion of the Cervical Spine, Rotation
Range of Motion of the Hip Joint, Abduction and Adduction Range of Motion of the Hip Joint, Abduction and Adduction
One Solution to the Nine-Dot Problem One Solution to the Nine-Dot Problem
Problem Problem
Problem Problem
Video: Knee Animation

For a complete list of videos, visit our video library