Suppose the government decided to ease monetary policy, then increase taxes. In the short run in the Keynesian model, the effect of these policies would be to ________ the real interest rate and ________ the level of output.

If the production possibilities frontier is a straight line,

a. its slope will equal -1 b. resources must not be used efficiently c. resources must be unemployed d. society must not be using the latest technology e. resources must be equally adaptable at producing either product

In order to maintain a fixed exchange rate:

A. a country cannot change its money supply. B. a country must constantly increase its money supply. C. a country must constantly decrease its money supply. D. Maintaining a fixed exchange rate is unrelated to the money supply.