Question 1

Analysts have attempted to model the impact of monetary policy on net worth by emphasizing

Accepted Answer

A)  the impact of lower interest rates on business spending on fixed investment. 
B)  the impact of lower interest rates on household spending on housing and durable goods. 
C)  the liquidity of balance sheet positions as a determinant of business and household spending. 
D)  the greater variability of business spending compared to household spending. 
A)  the impact of lower interest rates on business spending on fixed investment. 
B)  the impact of lower interest rates on household spending on housing and durable goods. 
C)  the liquidity of balance sheet positions as a determinant of business and household spending. 
D)  the greater variability of business spending compared to household spending.

Question 2

What is the inflation gap? What is the output gap?

Accepted Answer

The inflation gap is the diffe

Question 3

In a closed economy,if the goods market is in equilibrium,national saving is $2 trillion,national consumption is $7 trillion,and government purchases are $2.5 trillion,then GDP equals

Accepted Answer

A)  $7 trillion. 
B)  $9.5 trillion. 
C)  $11.5 trillion. 
D)  Not enough information has been provided to determine the answer. 
A)  $7 trillion. 
B)  $9.5 trillion. 
C)  $11.5 trillion. 
D)  Not enough information has been provided to determine the answer.

Question 4

Increases in interest rates

Accepted Answer

A)  reduce borrowers' net worth. 
B)  reduce lenders' net worth. 
C)  increase the present value of borrowers' assets. 
D)  raise the cost to businesses of internal funding. 
A)  reduce borrowers' net worth. 
B)  reduce lenders' net worth. 
C)  increase the present value of borrowers' assets. 
D)  raise the cost to businesses of internal funding.

Question 5

Which of the following is NOT a reason given by economists for the failure of Okun's law to account for the rise in unemployment during the recession of 2007-2009?

Accepted Answer

A)  increased willingness among firms to lay off workers during recessions 
B)  a surge in productivity during the recession 
C)  the unusual severity of the recession 
D)  it does not take into account the effect of the stimulus 
A)  increased willingness among firms to lay off workers during recessions 
B)  a surge in productivity during the recession 
C)  the unusual severity of the recession 
D)  it does not take into account the effect of the stimulus

Question 6

An increase in the money supply will cause

Accepted Answer

A)  the IS curve to shift down and to the right. 
B)  the IS curve to shift up and to the left. 
C)  the LM curve to shift down and to the right. 
D)  the LM curve to shift up and to the left. 
A)  the IS curve to shift down and to the right. 
B)  the IS curve to shift up and to the left. 
C)  the LM curve to shift down and to the right. 
D)  the LM curve to shift up and to the left.

Analysts have attempted to model the impact of monetary policy on net worth by emphasizing

What is the inflation gap? What is the output gap?

In a closed economy,if the goods market is in equilibrium,national saving is $2 trillion,national consumption is $7 trillion,and government purchases are $2.5 trillion,then GDP equals

Increases in interest rates

Which of the following is NOT a reason given by economists for the failure of Okun's law to account for the rise in unemployment during the recession of 2007-2009?

An increase in the money supply will cause

Introducing Money and the Financial System

Money and the Payments System

Interest Rates and Rates of Return

Determining Interest Rates

The Risk Structure and Term Structure of Interest Rates

The Stock Market, information, and Financial Market Efficiency

Derivatives and Derivative Markets

The Market for Foreign Exchange

Transactions Costs, asymmetric Information, and the Structure of the Financial System

The Economics of Banking

Investment Banks, mutual Funds, hedge Funds, and the Shadow Banking System

Financial Crises and Financial Regulation

The Federal Reserve and Central Banking

The Federal Reserves Balance Sheet and the Money Supply Process

Monetary Policy

The International Financial System and Monetary Policy

Monetary Theory I: the Aggregate Demand and Aggregate Supply Model

Filters

Exam 18: Monetary Theory Ii: the Is-Mp Model

Analysts have attempted to model the impact of monetary policy on net worth by emphasizing

What is the inflation gap? What is the output gap?

In a closed economy,if the goods market is in equilibrium,national saving is $2 trillion,national consumption is $7 trillion,and government purchases are $2.5 trillion,then GDP equals

Increases in interest rates

Which of the following is NOT a reason given by economists for the failure of Okun's law to account for the rise in unemployment during the recession of 2007-2009?

An increase in the money supply will cause

Introducing Money and the Financial System

Money and the Payments System

Interest Rates and Rates of Return

Determining Interest Rates

The Risk Structure and Term Structure of Interest Rates

The Stock Market, information, and Financial Market Efficiency

Derivatives and Derivative Markets

The Market for Foreign Exchange

Transactions Costs, asymmetric Information, and the Structure of the Financial System

The Economics of Banking

Investment Banks, mutual Funds, hedge Funds, and the Shadow Banking System

Financial Crises and Financial Regulation

The Federal Reserve and Central Banking

The Federal Reserves Balance Sheet and the Money Supply Process

Monetary Policy

The International Financial System and Monetary Policy

Monetary Theory I: the Aggregate Demand and Aggregate Supply Model

Filters