The following questions are True, False, or Uncertain. Write 2-3 sentences to justify your answer. Graphs, when appropriate, will increase your professor's utility. a. An increase in a country's savings rate will increase the level of output per capita (Y/L), but it will not lead to sustained economic growth. b. An economy that is experiencing rapid "sectoral shifts" in which some industries grow rapidly and other shrink will see an increase in the natural rate of unemployment. c. Inflation that is higher than expected redistributes wealth from debtors to creditors. d. If the Federal Reserve purchases $5 million in government bonds, and if the required reserve ratio is 10%, the largest possible increase in the money supply is $50 million. e. A recession will cause an economy's long-run aggregate supply curve to shift to the left. (Note: This is from Chapter 20, which we will cover on April 26)
The following questions are True, False, or Uncertain. Write 2-3 sentences to justify your answer. Graphs, when appropriate, will increase your professor's utility. a. An increase in a country's savings rate will increase the level of output per capita (Y/L), but it will not lead to sustained economic growth. b. An economy that is experiencing rapid "sectoral shifts" in which some industries grow rapidly and other shrink will see an increase in the natural rate of unemployment. c. Inflation that is higher than expected redistributes wealth from debtors to creditors. d. If the Federal Reserve purchases $5 million in government bonds, and if the required reserve ratio is 10%, the largest possible increase in the money supply is $50 million. e. A recession will cause an economy's long-run aggregate supply curve to shift to the left. (Note: This is from Chapter 20, which we will cover on April 26)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:The following questions are True, False, or Uncertain. Write 2-3 sentences to justify
your answer. Graphs, when appropriate, will increase your professor's utility.
An increase in a country's savings rate will increase the level of output per capita
(Y/L), but it will not lead to sustained economic growth.
b. An economy that is experiencing rapid "sectoral shifts" in which some industries
grow rapidly and other shrink will see an increase in the natural rate of
unemployment.
c. Inflation that is higher than expected redistributes wealth from debtors to
creditors.
d. If the Federal Reserve purchases $5 million in government bonds, and if the
required reserve ratio is 10%, the largest possible increase in the money supply is
$50 million.
e. A recession will cause an economy's long-run aggregate supply curve to shift to
the left. (Note: This is from Chapter 20, which we will cover on April 26)
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