Exam 15: Financial Crises, stabilization, and Deficits

While targeting the deficit,which of the following is likely to occur after a negative aggregate demand shock?

A person who strongly wishes to avoid risk would pick which of the following choices?

Government spending rising during a recession is an example of

Monetary policy has an equal implementation lag as fiscal policy.

The legislative intent of the Gramm-Rudman-Hollings Act was to increase the nation's spending on public transfers.

The way the U.S.government borrows money to finance deficits is by the U.S.Treasury selling bills and bonds.

The budget deficit decreases during economic booms and increases during recessions.

A firm issues bonds to

Which of the following chances has the biggest expected return?

A stock market boom leads to greater investment by firms.

If a share of stock is correctly valued today,a bubble in the stock market is when you purchase a stock because

Under the original Gramm-Rudman-Hollings Act,a congressionally enacted budget deficit that was larger than the targeted amount would

If the expected future earnings of a company goes up,you would expect the price of its stock to

Corporations are required to pay dividends.

A capital gain is

When there is a run up in stock prices

Refer to the information provided in Figure 15.1 below to answer the questions that follow. Figure 15.1 -Refer to Figure 15.1.If the economy is actually at Point C but policy makers think that it is still at Point B,this is an example of

In general,monetary policy has a longer ________ lag than fiscal policy but shorter ________ lag.

Refer to the information provided in Figure 15.1 below to answer the questions that follow. Figure 15.1 -Refer to Figure 15.1.If the condition of the economy at point E is realized by policy makers when the economy is at point G,policy is likely to be inappropriate due to

If you own a share of stock in a company and the risk associated with its business rises you would expect