All else equal, in an economy with an upward-sloping production function, as an economy accumulates more capital goods,

By changing the reserve requirement the Fed can change the level of bank reserves and the lending capacity of the banking system.

a. true b. false

Which of the following will be a short run impact of a pre-election expansionary fiscal policy, public expectations remaining constant?

a. An increase in unemployment b. A decline in real GDP c. An increase in real GDP d. A fall in the rate of inflation e. An economic recession