Key Relationships Flashcards
1
Q
interest rates ^ –> investment ?
A
Decrease
2
Q
Taxes ^ –> Disposable Income?
A
Decrease
3
Q
Government Spending^ –> National Income?
A
Increase
4
Q
MPC^ –> Spending Multiplier?
A
Increase
5
Q
Capital Stock^ –> Growth?
A
Increase
6
Q
Inflation^ –> Real Wages?
A
Decrease
7
Q
Inflation^ –> Real Interest Rates?
A
Decrease
8
Q
Deficit Spending^ –> Interest Rates?
A
Increase
9
Q
Money Supply^ –> Interest Rates
A
Decrease
10
Q
Reserve Requirement^ –> Money Supply?
A
Decrease
11
Q
Discount Rate^ –> Money Supply?
A
Decrease
12
Q
Fed Buys bonds^ –> Money Supply?
A
Increase
13
Q
Interest Rates^ –> Bond Prices?
A
Decrease
14
Q
International value of a dollar^ –> US Net Exports?
A
Decrease
15
Q
Interest Rates^ –> Net Capital Inflow?
A
Increase
