Problem 1) If the Fed printed too much money, money's relative price would _________ and the money price of goods would __________.
a. fall; rise
b. rise; fall
c. fall; fall
d. rise; rise
Problem 2) If workers begin to expect more inflation in the future, then we would expect that:
a. the short-run aggregate supply curve will shift up.
b. the short-run aggregate supply curve will shift down.
c. the short-run aggregate supply curve will not shift.
d. the aggregate demand curve will shift left.
Problem 3) A fiscal policy that reduces a budget deficit could conceivably __________ income if interest rates ______________.
a. increase; fall enough
b. increase; rise enough
c. decrease; fall too much
d. decrease; rise enough