Econ 200 Final Study Guide Rated A+

Keynesians would advocate an expansionary monetary policy to eliminate a recessionary gap if they believed investment spending was insensitive to changes in the interest rate. {Ans: Which of the following statements is false?}a monetary phenomenon {Ans: According to Milton-Friedman, continued inflation is always and everywhere}L or M {Ans: Point C on graph 2 corresponds to which point(s) on graph 1}place more oil on the market this year, thus shifting the present supply curve of oil rightward {Ans: Oil producers expect that oil prices next year will be lower than oil prices this year. As a result, oil producers are most likely to}increase {Ans: According to Keynesians, when money supply rises, interest rates will decrease, investment will increase, shifting the AD curve to the right. This causes Real GDP to ____________.}the price level rises, Real GDP falls, and the unemployment rate rises. {Ans: Starting from short-run equilibrium, the following occurs: personal taxes rise and foreign real national income rises. What is the effect on the price level, Real GDP, and the unemployment rate in the short run?}inverse; the interest rate {Ans: The demand for money curve illustrates the _________ relationship between quantity demanded of