Assume that investment does not depend on the interest rate. A reduction in government spending will cause which of the following for this economy?
A) no change in the interest rate
B) no change in output
C) no change in investment
D) an increase in investment
E) none of the above
E
Economics
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If the inflation rate target is 2%, the current inflation rate is 3%, and the output gap is 2%, then according to the Taylor rule, the nominal federal funds rate should be ________ percent
A) 4.5 B) 7 C) 6.5 D) 5.5 E) none of the above
Economics
M2 consists of: a. M1 plus savings accounts, small time deposits, money market mutual funds, and miscellaneous near-monies. b. coins, currency, and checkable deposits only
c. only near-monies. d. M1 plus time deposits only. e. M1 plus money market mutual funds only.
Economics