Assume the central bank decides to pursue contractionary monetary policy. Where and how should you begin your analysis when analyzing the chain reaction of economic interactions?
a. Start the analysis in the real goods market with aggregate demand shifting to the left.
b. Start the analysis in the real goods market with aggregate demand shifting to the right.
c. Start the analysis in the real credit market with demand for real credit shifting to the left.
d. Start the analysis in the real credit market with demand for real credit shifting to the right.
e. Start the analysis in the real credit market with supply of real credit shifting to the left.
.E
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Which of the following examples correctly identifies preference reversals?
A) Alice starts using public transport when the price of gasoline increases. B) Sarah's consumption of coffee increases substantially when the price of tea increases. C) Terry decides on Monday that he would join music classes from Thursday, but refuses to do so on Thursday. D) The extra utility that Tim derives from consuming additional units of ice cream decreases as he consumes more ice cream.
The policy in which industrial production is oriented towards foreign consumers is called
A. import substitution. B. export orientation. C. import promotion. D. export promotion.