Fed doubles growth rate of quantity of money in the economy

Assignment Help Business Economics

Reference no: EM13898609

Suppose the Fed doubles the growth rate of the quantity of money in the economy. In the long run, the increase in money growth will change which of the following? Check all that apply.

The price level

The inflation rate

The quantity of physical capital

The size of the labor force

Suppose the economy produces real GDP of $70 billion when unemployment is at its natural rate.

Use the purple points (diamond symbol) to plot the economy's long-run aggregate supply (LRAS) curve on the graph.

Suppose the government passes a law that significantly increases the minimum wage. The policy will cause the natural rate of unemployment to----------------- , which will:

Shift the long-run aggregate supply curve to the left

Shift the long-run aggregate supply curve to the right

Not affect the long-run aggregate supply curve

In the following table, determine how each event affects the position of the long-run aggregate supply (LRAS) curve.

Direction of LRAS Curve Shift

The government allows more immigration of working-age adults.

This economy's primary source of foreign oil decides to cease exports for political reasons.

A government-sponsored training program increases the skill level of the workforce.

Reference no: EM13898609

Questions Cloud

A market has many small firms and one dominant firm : A market has many small firms and one dominant firm. The market demand is Q = 100 - 5P. The dominant firm has a constant marginal cost of $6. All the smaller fringe firms combined have a supply curve given by Qs = 4P - 8.

Determine the tax issue : First determine the tax issue. Then research the issue and determine your conclusion. Fred Fisher is a licensed scuba diver who lives in Key Largo. He is employed full-time as an engineer. Five years ago he had been employed as a professional diver ..

Economy in long-run equilibrium at the expected price level : The following graph shows the economy in long-run equilibrium at the expected price level of 120 and the natural rate of output of $600 billion. Suppose firms become pessimistic about future business conditions and cut back on investment spending.

Fed doubles growth rate of quantity of money in the economy : Suppose the Fed doubles the growth rate of the quantity of money in the economy. In the long run, the increase in money growth will change which of the following?

Real economic variables and nominal economic variables : Most economists believe that real economic variables and nominal economic variables behave independently of each other in the long run. For example, an increase in the money supply, a-------------- variable, will cause the price level, a-----------..

Most vocal political pressure for tariffs is generally made : The most vocal political pressure for tariffs is generally made by:

Problem encountered-implementing infant industry tariff : A problem encountered when implementing an "infant industry" tariff is that:

Calculate the effective rate of protection : Suppose that the production of $1 million worth of steel in Canada requires $100,000 worth of taconite. Canada’s nominal tariff rates for importing these goods are 20 percent for steel and 10 percent for taconite. Calculate the effective rate of prot..

User Account

All Pages