The average percentage markup in the economy
a. is of special interest in microeconomics
b. fluctuates greatly from year to year
c. depends on competitive conditions in the economy
d. depends on the level of GDP
e. increases as the interest rate increases
C
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If the federal government tries to make fiscal policy sustainable by increasing seigniorage, the economy would experience ________ and will result in ________ potential GDP
A) a decrease in the growth rate of the money supply; lower B) an increase in the growth rate of the money supply; higher C) an increase in inflation; lower D) a decrease in the real interest rate; higher
If the Fed sells bonds and, thereby, unexpectedly shifts to a more restrictive monetary policy, in the short run, the primary impact of this policy will tend to
a. increase inflation. b. reduce unemployment. c. increase real output. d. increase real interest rates.