When the Fed purchases additional securities and shifts to a more expansionary monetary policy,
a. the inflation rate will rise almost immediately.
b. the growth of output and employment will increase quickly.
c. several months will typically pass before the shift in policy exerts much impact on output and employment.
d. this policy will eventually lead to a decline in the general level of prices if it is continued for a prolonged period of time.
C
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Price discrimination occurs when a firm sells
A) a given product at different prices at different points in time. B) a given product at different prices to different ethnic groups. C) a given product at different prices unrelated to differences in cost. D) a given product at different prices when it is produced in different colors.
If the economy spends 80 percent of any increase in real GDP, then an increase in investment of $1 billion would result ultimately in an increase in real GDP of:
a. $0. b. $0.8 billion. c. $1.0 billion. d. $5.0 billion.