Fiscal policy is concerned with government's manipulation of taxing, spending, and the money supply to encourage full employment at stable prices.

Refer to Scenario 25-1. M2 in this simple economy equals

A) $3,000. B) $8,000. C) $14,000. D) $21,000.

The income and substitution effects move in ________ for lenders and in ________ for borrowers

A) the same direction; the same direction B) the same direction; opposite directions C) opposite directions; the same direction D) opposite directions; opposite directions