A Swedish charity sends natural disaster assistance to the United States. This transaction appears as a…

Suppose that the government spending multiplier is 2, and that the tax multiplier is -2.5. A reduction in government spending and taxes of $100 million will ____ Real GDP by ____.

A Danish consumer purchases an American-made F150 at a Ford dealership in Coppenhagen. This transaction appears as a…

With the single exception of changes in the capital gains tax rate, expansionary fiscal policy typically leads the real interest rate to ____, because it leads an existing government budget deficit to ____.

Expansionary fiscal policy that is implemented to prevent real GDP from falling below potential GDP will likely result in a ______ inflation rate and a _____ level of Real GDP.

Suppose that Jose withdraws $45 from his mom’s checking account at the Bank of Tampa. He keeps $15 in cash and deposits the rest in his own savings account at Bank of America. Which of the following has occurred?

Suppose that Ford is an American company, and that Volkswagen is a German company. Which of the following would count in the American GNP, but not in the American GDP?

Suppose that the Federal Reserve decides to conduct “extraordinary” open-market purchases. This leads the Federal Funds Rate to _____, and commercial banks should respond by ____ lending.

Reducing the Labor Income Tax leads to a(n) ____ in employment, and is considered ____ fiscal policy.

Which of the following functions do commercial banks NOT perform?