Aggregate output is increased by a decrease in
A) autonomous consumption.
B) government spending.
C) planned investment.
D) net taxes.
D
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________ in the domestic interest rate causes the demand for domestic assets to decrease and the domestic currency to ________, everything else held constant
A) An increase; appreciate B) An increase; depreciate C) A decrease; appreciate D) A decrease; depreciate
Assume the economy is in short-run equilibrium at a real GDP above its potential real GDP. According to classical theory, which of the following policies should be followed? a. The Federal Reserve should use open market operations and buy U.S. government securities. b. The Federal Reserve should not follow a fixed rule
c. The federal government should cut taxes. d. Fiscal policy and monetary policy should not be activist.