Fiscal policy
a. is dangerous in the short run because it crowds out investment spending
b. can change equilibrium GDP in the short run
c. can change equilibrium GDP in the long run
d. can change equilibrium GDP in both the long and the short run
e. is dangerous in the long run because it triggers a multiplier effect
B
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Under the Fed's current interest-rate-targeting approach to monetary policy, if the demand for federal funds by depository institutions increases today, then, other things being equal
A) the market federal funds rate decreases, and the Fed's Trading Desk responds by selling bonds. B) the market federal funds rate increases, and the Fed's Trading Desk responds by buying bonds. C) the market federal funds rate decreases, and the Fed's Trading Desk responds by buying bonds. D) the market federal funds rate increases, and the Fed's Trading Desk responds by selling bonds.
Refer to the graph below. At which point does marginal product (MP) equal average product (AP) at a level of output?
A. Point A
B. Point B
C. Point C
D. Point D