1.)Which of the follwoing would not cause an increase the LRAS? an increase in l
ID: 1197618 • Letter: 1
Question
1.)Which of the follwoing would not cause an increase the LRAS?
an increase in land resources
a decrease in govenrment regulations
an improvement in technology---- this is wrong
a decrease in the labor force
2.)The long-run aggregate supply curve illustrates
a country's minimum real GDP.
a country's actual real GDP.
a country's potental real GDP.
a country's maximum possible real GDP.------- wrong answer
3.)According to the Laffer Curve,
decreasing tax rates will always cause tax revenue to decrease.
decreasing tax rates will always cause tax revenue to increase.
decreasing tax rates may or may not cause tax revenue to decrease.
increasing income taxes will always cause tax revenues to increase while increasing corporate taxes will always cause tax revenues to decrease.------- wrong answer
4.)In the long-run, an increase in the national debt is "bad" because it
stimulates aggregate demand.
causes crowding in.
causes interest rates to decline.------------- wrong answer
usually leads to an increase in interest payments made by the federal government.
5.)If a bank accepts a deposit of $50,000 and all banks have a required reserve ratio of 10 percent, how much new money can that bank create using that deposit?
$5,000-----------wrong answer
$500,000
$45,000
$0
6.)Quantity of money demanded refers to
total amount of money assets someone wants to possess.------- wrong answer
total amount of money assets someone actually possesses.
value of assests minus value of liabilities.
the portion of assets held as money.
7.)An increase in the supply of money would cause
aggregate supply to increase------- wrong answer.
aggregate income to decrease.
aggregate demand to increase.
real GDP to decrease.
the price levels to fall.
8.)The Federal Reserve Bank could increase the money supply by doing all of the following except
decreasing taxes.
buying bonds.
lowering reserve requirements.---------- wrong answer
lowering the discount rates.
Can't figure out these answers can anyone help me please ?????
Explanation / Answer
1. Decrease in labour force will give an inward shift to the curve . LRAS is located at potential GDP.
2. Potential GDP becahse it represent the level of real national output in the economy.
3. Option c , because it is a bell shaped curve decresing tax rates can motivate people to work more which can increase GDP which in turn will increase per capita income and will finally increase the revenue.
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