Using a graph above, show the short-run and long-run effects of an expansionary monetary policy
What will be an ideal response?
In the above figure, E1 is the original equilibrium. The increase in the money supply causes the aggregate demand to increase due to the direct and indirect effects. Real GDP increases in the short run to $15 trillion and the price level increases to 120. Once input owners revise their expectations about prices, the short-run aggregate supply curve shifts to SRAS2, real GDP returns to $14 trillion, and the price level increases to 140. The long-run effect of the expansionary monetary policy is to increase the price level.
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A second-price auction
a. is also called a Vickrey auction b. is conducted by bidders submitting a single sealed bid c. is where the highest bidder wins and pays the amount of the next highest bid d. all of the above
Suppose a country had $3.5 billion of net exports and bought $6.8 billion of goods and services from foreign countries. This country would have
a. $10.3 billion of exports and $6.8 billion of imports. b. $10.3 billion of imports and $6.8 billion of exports. c. $6.8 billion of exports and $3.5 billion of imports. d. $6.8 billion of imports and $3.5 billion of exports.