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Amanda wants to know about government policy and inflation. Which of the following is correct? A. If fiscal policy is used to reduce cost push inflation, the unemployment rate will increase O B. If fiscal policy is used to reduce cost push inflation, the unemployment rate will decrease O C. If fiscal policy is used to reduce cost push inflation, the aggregate demand curve shifts rightward O D. If fiscal policy is used to reduce cost push inflation, this causes the tax-rate to decrease and government spending to rise Reset SelectionThe money multiplier declines if O A. the desired reserve ratio increases O B. people choose to hold a greater proportion of cash as currency rather than in demand deposits. O C. interest rates rise O D. both A and B. Reset SelectionWhich of the following statements is true? A. The asset demand for money varies directly with GDP. B. The asset demand for money varies inversely with GDP. O) C. The asset demand for money increases at higher interest rates. O D. None of the above. Reset SelectionWhich of the following statements is true? O A. Economic growth causes leftward shifts of the aggregate supply curve. B. Aggregate supply shocks can cause either higher inflation or higher unemployment, but not both. O C. Cost-push inflation arises from factors that increase the cost of production at each price level. OD. Under normal circumstances, there is no tradeoff between inflation and unemployment. Reset SelectionWhich of the following does not cause cost-push inflation? O A. Wage caps on CEOS. O B. Agricultural shortfalls. O C. Increasing global oil prices. O D. Declining productivity. Reset SelectionOne of the effects of expansionary monetary policy is that it increases O A. interest rates B. the value of domestic currency O C. net exports O D. All of the above. Reset SelectionHere is a blance sheet for a TD Bank on London. All figures are in millions. Liabilities and net worth Cash Reserves Demand Deposits Securities Stock shares Loans roperty If TD bank finds that it has excess reserves of $8, the desired ratio must be: O A. 20 percent. 0 B. 10 percent. O C. 12 percent. O D. 14 percent. Reset Selection Consider the principles of supply side economics in the context of the country Estonia. Which of the follotniing is not a principle of this type of economics? 0 A. The central bank of Estonia should keep the growth of the money supply at a xed annual rate to manage aggregate supply 0 Es. Social security and welfare payments will make the citizens of Estonia want to work less hours 0 C. Very high tax rates will not make the citizens of Estonia want to work hard or invest O D. The aggregate supply curve will shift leward if taxes are increased in Estonia Re set Selection he value a dollar falls when: A. the price index is falling. B. interest rates are rising. C. the price index is rising. D. real incomes are falling. Reset SelectionSuppose the demand for money rises at the same time that the supply:r of money.r falls. We: 0 A. can expect the interest rate to rise and bond prices to fall. 0 E. can expect the interest rate to fall and bond prices to nse_ O C. can expect the nominal GDP to contract. 0 D. cannot predict what will happen to interest rates or bond prices. RE set Selection
