Expansionary fiscal policy will
a. shift the aggregate demand curve to the left.
b. shift the aggregate demand curve to the right.
c. not shift the aggregate demand curve
d. shift the short-run aggregate supply curve to the left.
b. shift the aggregate demand curve to the right.
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A commercial bank has no excess reserves until a depositor places $2,000 in cash in the bank. The reserve ratio is 10%. The bank then lends $1,500 to a borrower. As a consequence of these transactions the bank's excess reserves are:
A. Not affected B. Increased by $200 C. Increased by $300 D. Increased by $500
Jenny sells lemonade in front of her house in the summer. Several other kids in Jenny's neighborhood also run lemonade stands in the summer. If the lemonade market is perfectly competitive and Jenny is charging the equilibrium price, then Jenny can increase her revenue if she:
A. keeps the price of her lemonade the same and increases the output. B. decreases the price of her lemonade and doesn't change her output. C. increases the price of her lemonade and decreases her output. D. increases the price of her lemonade and doesn't change her output.