Which of the following is blamed for the lack of increased business investment spending on new factories and machinery during the 1930s?
(a) The new presence of government's large-scale economic activity caused business to lose some of its former confidence.
(b) The general outlook stressed caution.
(c) A much lower rate of population growth and family creation depressed the housing market.
(d) All of the above.
(d)
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When the domestic currency is initially overvalued in a fixed exchange rate regime, the central bank must intervene in the foreign exchange market to ________ the domestic currency, thereby allowing the money supply to ________
A) purchase; decline B) sell; decline C) purchase; increase D) sell; increase
An estimated demand curve does NOT necessarily match actual data perfectly because
A) it is not possible to accurately calculate the coefficients of the curve. B) some factors that are not measured or observed may affect the curve. C) the random error term has too large of a range. D) demand is unpredictable.