Please check my answers; stuck on a few questions on my homework.
1. In the long run, an increase in the supply of bank loans is matched by a __________ in the price level and the quantity of real loans is __________.
A. rise; unchanged
B. rise; increased
C. fall; unchanged
D. fall; decrease
---my answer is "B"---
2. An increase in the supply of loanable funds is an increase in __________.
A. the inflation rate
B. the unemployment
C. federal funds rate
D. investments
---my answer "A"---
3. If real GDP is below potential GDP, the government might decrease its expenditure on goods and service, decrease transfer payments, raise taxes, or do some combination of all three. This is called a(n. __________.
A. automatic fiscal policy
B. discretionary fiscal policy
C. contractionary fiscal policy
D. fiscal stimulus
---my answer "A"---
4. Income taxes create a difference between the interest rate paid by companies and received by lenders. These taxes __________ saving, investment, and the growth rate of real GDP.
A. do not affect
B. lower
C. encourage, but may not change
D. increase
---my answer C---
5. What type of stabilizing fiscal policy is an increase in the health care budget for citizens without coverage?
A. automatic fiscal policy
B. discretionary fiscal policy
C. contractionary fiscal policy
D. long run fiscal policy
---my answer "A"---
1 answer
1 answer