What will happen to unemployed retail workers if the government is unable to target stimulus spending at the retail sector?
A. Most will become discouraged and leave the labor force.
B. They may eventually find work after government spending works its way through the economy.
C. They may eventually find work after the Fed reduces tax rates, increasing household consumption spending.
D. They will remain permanently unemployed unless they find work in another sector of the economy.
Answer: B. They may eventually find work after government spending works its way through the economy.
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If the money price of a resource such as oil falls, then the
A) LAS curve shifts rightward. B) LAS curve shifts leftward. C) SAS curve shifts leftward. D) SAS curve shifts rightward.
Attempts by a central bank to increase bank deposits without a decrease in nominal short-term interest rates are referred to as ________
A) quantitative easing B) credit channeling C) open market operations D) liquidity provision