According to the interest-rate-based monetary policy transmission mechanism, an increase in the money supply generates
A) increased spending on consumer goods and services directly, which causes an increase in aggregate demand.
B) an increase in aggregate supply since the supply of money is part of aggregate supply.
C) lower interest rates, which causes an increase in planned real investment spending and an increase in aggregate demand.
D) an increase in nominal GDP and a change in the price level, but no change in real GDP.
C
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Refer to the diagram. The MRC curve lies above the labor supply curve because:
A. any number of workers can be hired at the going equilibrium wage rate.
B. the firm must lower product price to increase its sales.
C. the higher wage needed to attract additional workers must also be paid to the workers
already employed.
D. there is an inverse relationship between wage rate and the amount of labor employed.
Economic growth focuses on ____________, utility focuses on ____________, and the capabilities approach focuses on __________________.
A. human development; individual pleasure; output B. output; human development, individual pleasure C. output; individual pleasure; human development D. human development, output, individual pleasure