The simple multiplier formula assumes the following, except:
A. The economy has excess capacity and room to expand output
B. Firms will raise prices as buyers buy more of their output
C. People will spend more if they earn additional income
D. Business firms will increase production if demand for their output increases
B. Firms will raise prices as buyers buy more of their output
Economics
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Legal constraints will always reduce the size of the economic pie
Indicate whether the statement is true or false
Economics
When depository institutions have negative excess reserves, it indicates that the banking system is not "loaned up."
a. True b. False Indicate whether the statement is true or false
Economics