If a central banking authority lowers interest rates in order to encourage more borrowing, which of the following combinations describes this type of policy?

A.)

Contractionary and fiscal

B.)

Expansionary and monetary

C.)

Contractionary and monetary

D.)

Expansionary andfiscal

Government expenditures create demand for goods and services. This is known as __________ and will cause AD to shift to the __________.

A.)

contractionary fiscal policy; right

B.)

expansionary fiscal policy; right

C.)

contractionary monetary policy; left

D.)

expansionary monetary policy; left

During the 1970s, some economists argued that the woes of the economy were due to __________.

A.)

low taxes and a government surplus that should have been spent on social programs

B.)

an increase in unemployment as women entered the labor force

C.)

supply shocks because ofissues with the supply of oil

D.)

brain drain because of ineffective education and training

When the government finances debt, interest must be paid to __________.

A.)

stockholders

B.)

member banks with excess deposits

C.)

bondholders

D.)

fund transfer payments

Which statement refers to a practice or situation that is NOT economically sustainable?

A.)

The production ofmore goods by using more inputs

B.)

The increase of productivity by new inventionswith the same amount of raw material

C.)

The economy being at less than full employment

D.)

Current levels of output being maintained indefinitely

Short-term stabilization policies, such as cutting taxes or increasing government spending, will shift which curve?

A.)

PPC

B.)

SRAS

C.)

AD

D.)

LRAS