Faced with an adverse supply shock, if the central bank wants to stabilize output, it should
A. decrease the money supply.
B. increase the money supply.
C. decrease government spending.
D. increase government spending.
Answer: B. increase the money supply.
Economics
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Why does a perfectly competitive market require many participants as both buyers and sellers?
(A) So that both buyer and seller have the same information. (B) In order to maintain quality over the goods. (C) So that no individual can control the price. (D) Because the merchandise must be uniform.
Economics
A good that has social costs that exceed private costs has a quantity that is
A) too high. B) too low. C) just right. D) the best society can do.
Economics