What is the short-run impact of an increase in savings on the inflation rate? A. It would have no effect on the inflation rate B. It would cause the inflation rate to go down Technological advance: A. Is the ability to produce more output per resource B. Only leads to economic growth if it does not destroy jobs C. Neither of the above Which of these would be the most useful predictor of a country's future economic growth? A. The country's GDP per capita today B. The country's budget deficit today C. The country's unemployment rate today If the Fed buys U.S. government securities in the open market: A. Bank reverses will increase B. Monetary base will decrease C. The money supply will decrease Whatever is generally accepted as a medium of exchange is: A. Barter B. Money C. A resource Open market operations: A. Refers to the Feds acting as lender of last resort of banks B. Is the Fed's most important monetary policy tool When we hold money for later use: A. We are using it as a measure of value B. We are using it as a store of value Which of these would be the most useful predictor of a country's future economic growth? A. The country's interest rate on bank loans today B. The country's GDP per capita today C. The country's unemployment rate today A monetary rule: A. Requires a return to the gold standard B. Would link money supply growth to real GDP growth C. All of the above Where does economic growth primarily come from? A. Shifts in AD only B. Shifts in AS only C. Neither shifts in AD nor shifts in AS Expansionary monetary policy: A. Means a decrease in the money supply B. Would be used to close a recessionary gap C. Both of the above An increase in the overall costs of production will cause: A. A decrease in SRAS B. No change in SRAS C. All of the above are possible Fractional reserve banking: A. Makes it possible for the banking system to create money B. Makes the potential deposit multiplier greater than one C. All of the above Which of the following statements are correct? A. Lower income households consume a higher percentage of their incomes compared to higher income households. B. Any tax that increases the prices on nonluxury goods will be regressive C. Both of the above D. Neither of the above Deficit spending: A. Increases the governments demand for loanable funds, driving up interest rates B. Causes higher interest rates, which crowd out investment C. Reduces present investment, which leads to slower economic growth in the future D. All of the above According to classical monetary theory: A. The velocity of money is constant B. There is a direct relationship between the money supply and the price level C. Both of the above D. Neither of the above Crowding out: A. Occurs when increases in government spending lead to decreases in private spending B. Will affect mainly consumption if increase government spending is paid for with increased taxes C. Will affect mainly investment if increased government spending is paid for with deficit spending D. All of the above