Economics 12E - Arnold - TB_333

Economics 12E - Arnold - TB_333 - causes a(n in the...

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causes a(n) __________ in the interest rate and a(n) __________ in investment, which in turn causes a(n) __________ in total expenditures and aggregate demand. a. increase; decrease; decrease b. increase; increase; decrease c. decrease; increase; increase d. decrease; decrease; increase ANSWER: c POINTS: 1 DIFFICULTY: Moderate NATIONAL STANDARDS: United States - BUSPROG: Analytic LOCAL STANDARDS: United States - OH - Default City - DISC: Monetary and fiscal policy KEYWORDS: Bloom's: Application 86. In the Keynesian transmission mechanism, if investment is completely interest-insensitive, then an increase in the money supply will a. cause total expenditures and aggregate demand to increase. b. cause total expenditures and aggregate demand to decrease. c. have no impact on total expenditures and aggregate demand. d. cause total expenditures to increase and aggregate demand to decrease. e. cause total expenditures to decrease and aggregate demand to increase. ANSWER: c POINTS: 1 DIFFICULTY: Moderate NATIONAL STANDARDS: United States - BUSPROG: Analytic LOCAL STANDARDS: United States - OH - Default City - DISC: Monetary and fiscal policy KEYWORDS: Bloom's: Application 87. In the Keynesian transmission mechanism, if the money market is in the liquidity trap, an increase in the money supply will POINTS: 1
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DIFFICULTY: Moderate NATIONAL STANDARDS:
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