The term contagion refers to
A) a government's complete control over it's banking system.
B) a drop in interest rates across industrialized countries.
C) the vulnerability of healthy economies to crises generated by events elsewhere.
D) a directed attack on one market by a foreign market.
E) a side effect of international trade.
C
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If the Fed wants to fight recession, it will ________ the federal funds rate in order to ________
A) lower; increase aggregate demand B) raise; increase aggregate supply C) lower; increase aggregate supply D) raise; decrease aggregate supply E) raise; increase aggregate demand
When aggregate expenditure is more than GDP, which of the following is true?
A) Firms spent less on capital goods than they planned. B) Households bought fewer new homes than they planned. C) There was an unplanned decrease in inventories. D) All of the above must be true when aggregate expenditure is more than GDP.