Professor Cowen says that _______ is one of the biggest personal and social costs of a recession.

As firms expect future profits to increase, they increase their investment. As a result, real GDP rises above potential GDP. If the Fed followed Friedman's k-percent rule, the Fed would

A) continue allowing the quantity of money to grow at "k" percent. B) increase the quantity of money more than usual. C) decrease the quantity of money. D) raise the federal funds rate. E) lower the federal funds rate.

If a country's merchandise exports exceed its merchandise imports it has a

A) trade surplus. B) trade deficit. C) current account surplus. D) current account deficit.