Shifts in the short-run aggregate supply curve lead to shifts in the short-run Phillips curve
a. True
b. False
Indicate whether the statement is true or false
True
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Suppose that the bond market and the money market both start out in equilibrium, then the Federal Reserve increases the money supply. The result will be a ______________ in the money market and a _________________ in the bond market, which will push bond prices _________________ and interest rates will ___________________ until a new equilibrium is reached
A) surplus; shortage; up; fall B) shortage; surplus; down; rise C) surplus; shortage; down; rise D) shortage; surplus; down; fall
Prices can achieve the rationing function when
A) prices are flexible. B) prices are inflexible. C) they are controlled by the government. D) price controls are in place and ration coupons are used too.