Which of the following statements is true? Ceteris paribus (everything else held equal),
a) r (down) --> Y (down) --> I (up) --> AE (down)
b) r (down) --> Y (up) --> I (up) --> AE (up)
c) r (down) --> AE (up) --> Y (up) --> I (up)
d) r (down) --> I (up) --> AE (up) --> Y (up)
Answer: d) r (down) --> I (up) --> AE (up) --> Y (up)
Economics
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Define potential GDP. Under what circumstances does actual real GDP fall short of potential GDP, equal potential GDP, and exceed potential GDP?
What will be an ideal response?
Economics
As the real interest rate rises, the quantity of loanable funds supplied ________ and the quantity of loanable funds demanded ________
A) does not change; does not change B) decreases; decreases C) increases; decreases D) increases; increases E) decreases; increases
Economics