Principles of Economics, 7th Edition (MindTap Course List)
7th Edition
ISBN: 9781285165875
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 30, Problem 4QCMC
To determine
Cause of hyperinflation.
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Students have asked these similar questions
An "inflation tax" is often associated with
a
a speculative real estate boom.
the higher interest rates and reduced investment
spending that result from the Government financing its
deficit in financial markets.
the excessive printing of money to finance a budget
deficit.
the increased taxes required to pay off the public debt
which crowd out household spending by reducing
disposable personal income.
d.
Government stabilization policy
a.
can stimulate aggregate demand, but only in the long run.
b.
can stimulate aggregate demand and thereby induce businesses to invest, but the amount is not totally predictable.
c.
can stimulate aggregate demand, but investment spending will not be affected.
d.
cannot influence investment spending
In the short run, ________ in the federal funds rate ________ the price level, and ________ real GDP.
a. lowering; increases; decreases
b. lowering; increases; does not change
c. lowering; increases; increases
d. raising; decreases; does not change
Chapter 30 Solutions
Principles of Economics, 7th Edition (MindTap Course List)
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- Please help Fill in the blanks.arrow_forwardUganda has an unstable macroeconomic situation and the government has decided to increase its spending to impose an expansionary fiscal policy. What effect it would have on the following; 1. Aggregate Demand and Supply 2. Price level and Output 3. Labour Market 4. Money Market Illustrate with the help of graph and step by step effect.arrow_forwardIn the short run, a rise in the federal funds rate ________ the price level and ________ real GDP. a. lowers; decreases b. lowers; does not change c. lowers; increases d. does not change; increasesarrow_forward
- Which of the following did the United States undertake to migitate the Great Recession ?arrow_forwardWhen the government increases spending (expansionary fiscal policy), inflation and employment are MOST LIKELY to change in which of the following ways? Inflation Level Unemployment Decrease, Increase Decrease, Decrease Increase, Decrease O Increase, Increasearrow_forwardAn increase in taxes would be a good policy A. when there is stagflation, as this policy would push aggregate supply to the right. B. during a recession, as this policy would stimulate aggregate demand. C. during a recession, as this policy would reduce aggregate supply. D. when there is inflation, as this policy would push aggregate demand to the left. E. when there is inflation, as this policy would push aggregate demand to the right. QUESTION 20 An increase in the price level will A. shift the aggregate demand curve to the left. B. shift the aggregate supply curve to the left. C. move the economy down along a stationary aggregate supply curve. D. shift the aggregate demand curve to the right. E. move the economy up along a stationary aggregate demand curve.arrow_forward
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