Econ 304 Final Exam 100% Correct!!

If a country's absorption = C + I + G is greater than its income Y, then the that country is running a trade deficit. {Ans: true}If x (the little x in front of r ) in the equation below rises, all else constant, the IS curve will get steeper, implying that monetary policy is getting less powerful in terms of influencing aggregate demand. {Ans: false}According to the most recent payroll report (Friday, 12/4), there were more jobs created that expected and thus, the stock market rallied. {Ans: false}According to the Fed's new policy regime, they really don't care what the unemployment rate is since the Phillips curve is currently flat indicating there is no relationship between inflation and unemployment. {Ans: false}When I was a child I was happy earning $1 for a days work - let's say it was in August 1968. Using the most recent CPI index (August 2020), that 1 $ back in August 1986 would be equivalent to over $10 today! {Ans: false}The WSJ article about the stock market rally (we discussed in Monday's lecture (12/7) argues that the rally in the stock market is due to a rise in expected