S es in Safari Which statement is CORRECT? O Monetary policy is controlled by the Federal Reserve and works by changing the demand for money and interest rates. O Fiscal policy is controlled by the president and congress and works by changing the federal income taxes paid by households and business and the level of government spending. The Federal Reserve's monetary policy decisions are made after consulting the president and congress. To stimulate output and employment using fiscal policy, the president and congress can lower interest rates and increase government spending. To reduce the inflation rate, the Federal Reserve can put controls on the price of essential goods and services. Moving to the next question prevents changes to this answer. 121 tv Question 4 of 10 > W

S es in Safari Which statement is CORRECT? O Monetary policy is controlled by the Federal Reserve and works by changing the demand for money and interest rates. O Fiscal policy is controlled by the president and congress and works by changing the federal income taxes paid by households and business and the level of government spending. The Federal Reserve's monetary policy decisions are made after consulting the president and congress. To stimulate output and employment using fiscal policy, the president and congress can lower interest rates and increase government spending. To reduce the inflation rate, the Federal Reserve can put controls on the price of essential goods and services. Moving to the next question prevents changes to this answer. 121 tv Question 4 of 10 > W

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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aget TRUE - OR - FALSE The amount the government owes to the public is the deficit. O True O False
Suppose the following table contains data of a Monopoly. Output Price (Tk.) Total Cost (Tk.) 0 14 2____________ 1 12 6____________ 2 10 8____________ 3 8 12___________ 4 6 20___________ 5 4 32___________ What is the profit maximizing quantity of this firm? What price the above firm chooses to sell its output?
Consider the following picture. c' A D B E F Suppose that the government changes government spending: it increases G and decreases G', but leaves T and T' unchanged. The interest rates in the economy are also unchanged. What happens to the budget line of the consumer? O It expands to the right: the consumer will be able to consume more in the present, and less in the future It contracts to the left: the consumer will be able to consume less in the present, and more in the future O It's unchanged O Impossible to tell!
How do transfer payments in the form of unemployment compensation work as an automatic fiscal stabilizer during a recession? a. Transfer payments boost the oscillation in the business cycle. b. Transfer payments decrease the government expenditure that helps in controlling the recession. c. Transfer payments increase government spending that, in turn, decreases disposable income. d. Transfer payments lead to a rise in tax revenue that further boosts the money supply in an economy. e. Transfer payments work as income supports and reduce the effects of the recession.
What happens if there is an increase in the budget deficit? O O Raise the real Interest rate and decline the quantity of loanable funds demanded for Investment Lower the real Interest rate and decrease the quantity of loanable funds demanded for Investment. Lower the real Interest rate and increase the quantity of loanable funds demanded for Investment. Raise the real Interest rate and increase the quantity of loanable funds demanded for Investment. Reset Answer
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Refer to the figure at right. Government policy that moved the economy from A to B would be accomplished by O A. an expansionary fiscal policy combined with a contractionary monetary policy. O B. OC. a contractionary fiscal policy combined with an expansionary monetary policy. a contractionary policy that would reduce the rate of inflation and would cause workers to remain unemployed longer than they were before. O D. raising the minimum wage. Inflation Rate 2.5 A B I 6 D Unemployment Rate
The graph to the right shows a situation in which the economy was in equilibrium at potential GDP (at point A) when the demand for housing sharply declined. What actions can the federal government take to move the economy back to potential GDP? OA. Increase the money supply. B. Increase government spending or decrease taxes. OC. Decrease government spending or increase taxes. OD. Both A and B. 1.) Use the line drawing tool to draw the results of these actions on your graph. Label your new line(s). 2.) Use the point drawing tool to locate the new equilibrium point. Label this point 'C'. Carefully follow the instructions above, and only draw the required objects. P₁ LRAS B Y₁ Yo AD₁ Real GDP (Y) SRAS AD
If Congress wanted to help the economy out of a recession, they would be most likely to: check all that apply increase interest rates reduce government spending O increase transfer payments O decrease taxes
1-D please.
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