« previous next »

Author Question: Suppose the economy is on the classical range of the aggregate supply curve and has a problem with ... (Read 259 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?

Historic treatments for rheumatoid arthritis have included gold salts, acupuncture, a diet consisting of apples or rhubarb, nutmeg, nettles, bee venom, bracelets made of copper, prayer, rest, tooth extractions, fasting, honey, vitamins, insulin, snow collected on Christmas, magnets, and electric convulsion therapy.

Did you know?

Your skin wrinkles if you stay in the bathtub a long time because the outermost layer of skin (which consists of dead keratin) swells when it absorbs water. It is tightly attached to the skin below it, so it compensates for the increased area by wrinkling. This happens to the hands and feet because they have the thickest layer of dead keratin cells.

Did you know?

In 2010, opiate painkllers, such as morphine, OxyContin®, and Vicodin®, were tied to almost 60% of drug overdose deaths.

Did you know?

Symptoms of kidney problems include a loss of appetite, back pain (which may be sudden and intense), chills, abdominal pain, fluid retention, nausea, the urge to urinate, vomiting, and fever.

Did you know?

People often find it difficult to accept the idea that bacteria can be beneficial and improve health. Lactic acid bacteria are good, and when eaten, these bacteria improve health and increase longevity. These bacteria included in foods such as yogurt.

Mensuration: A goniometer is used to measure the range of motion of a joint. Mensuration: A goniometer is used to measure the range of motion of a joint.
How to solve a linear algebraic mixture problem with two unknowns How to solve a linear algebraic mixture problem with two unknowns
Latin America in the Global Economy Latin America in the Global Economy
How to solve a trigonometric problem involving two right triangles (Question 2) How to solve a trigonometric problem involving two right triangles (Question 2)
How to solve any percent concentration problem How to solve any percent concentration problem
Marginal Supply - Demand Curve Marginal Supply - Demand Curve
Video: Cognitive development by Piaget (Preoperational stage or intelligence)

For a complete list of videos, visit our video library