Which of the following if true would suggest that an expansionary gap exists in an economy?
a. Rapid inflation during a period when plant capacity utilization is below average
b. A steady price level coupled with a 5 percent unemployment rate
c. An unemployment rate below its natural rate and an unexpected increase in the consumer price index
d. Sluggish growth in the rate of inflation and an exceptional increase in the Dow Jones average
e. A modest increase in the number of new unemployment claims and a lower than expected price level
Question 2
If the Fed sells U.S. government securities in the open market, gross domestic product:
a. increases because the resulting increase in the interest rate leads to a decrease in investment.
b. increases because the resulting decrease in the interest rate leads to an increase in investment.
c. decreases because the resulting increase in the interest rate leads to a decrease in investment.
d. decreases because the resulting increase in the interest rate leads to an increase in investment.
e. decreases because the resulting decrease in the interest rate leads to an increase in investment.
Which of the following statements is true of linkage?
This chart illustrates the four quadrants in which we can place the relationships between the state
Major trunk lines carrying long-distance traffic crisscrossed the area east of the Mississippi. The
Which is TRUE about the alternation of generations cycle that is diagramed above?
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