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Econ 402 final || with 100% Errorless Solutions.
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  • Econ 402
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  • Econ 402

what happens to IS curve when taxes increase? correct answers shifts left what happens to IS curve when gov spending increases? correct answers shifts right what happens to IS curve when permanent income increases? correct answers shifts right what happens to IS curve when stock prices fal...

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  • August 16, 2024
  • 7
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

Subjects

  • what happens to is curve when taxes increase

Written for

  • Econ 402
  • Econ 402

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Econ 402 final || with 100% Errorless Solutions.
what happens to IS curve when taxes increase? correct answers shifts left

what happens to IS curve when gov spending increases? correct answers shifts right

what happens to IS curve when permanent income increases? correct answers shifts right

what happens to IS curve when stock prices fall? correct answers shifts left

what happens to IS curve when corporate taxes increase? correct answers shifts left

money demand is ___ when output is high correct answers high

money demand is ___ when interest rates are high correct answers low

what happens to LM curve when money supply shrinks? correct answers shifts left

what happens to LM curve when money demand decreases? correct answers shifts right

what happens to LM curve when price level decreases? correct answers shifts right

true or false: monetary assets pay a fair amount of interest correct answers false

high output is associated with ____ prices correct answers lower

increase in gov spending causes unemployment to increase or decrease? correct answers decrease

increase in gov spending causes non-durable consumption to increase or decrease? correct
answers increase

increase in gov spending causes interest rate to increase or decrease? correct answers increase

increase in gov spending causes interest-sensitive consumption to increase or decrease? correct
answers decrease or ambiguous

what is the government spending multiplier? correct answers 1/(1-MPC)

What is the tax multiplier? correct answers -MPC/(1-MPC)

what is a good estimate for the government spending multiplier? correct answers 0.6

is fiscal or monetary policy the most viable form of stabilization? correct answers monetary

how many presidents are there from regional federal reserve banks? correct answers 5

, how to the chairman, vice chairman, and the federal governors gain positions at the federal
reserve? correct answers the president appoints them

how many regional federal reserve banks are there? correct answers 12

every $1 increase in total reserves increases the money supply by... correct answers 1/RRR

does buying bonds increase or decrease the money supply? correct answers increase

does selling bonds increase or decrease the money supply? correct answers decrease

what monetary policy instrument is the main instrument of the Fed? correct answers open market
operations

the interest rate for short term loans between banks is called the ___ correct answers federal
funds rate

the interest rate that banks charge their best customers is called the... correct answers prime rate

the rate at which member banks borrow money from the Fed is called the... correct answers
primary credit rate

the primary credit rate is _________ the federal funds rate. correct answers 1% above

the RRR on demand deposits is... correct answers 3%

if RRR decreases, what happens to money supply correct answers increases

a liquidity trap implies a _________ on interest rates correct answers lower bound

if the exchange rate decreases, you can purchase _____ foreign currency for your dollar, making
foreign goods _____, causing NX to ______ correct answers less, more expensive, increase

if the exchange rate increases, you can purchase ______ foreign currency for your dollar, making
foreign goods _____, causing NX to ______ correct answers more, cheaper, decrease

true or false: recessions in France can be addressed by the French central bank correct answers
false

with a floating exchange rate system, which is more effective in increasing Y, monetary or fiscal
policy? correct answers monetary

with a fixed exchange rate system, which is more effective in increasing Y, monetary or fiscal
policy? correct answers fiscal

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