The Great Recession of 2007-2009 Altered the Prior Behavior of Consumers

question 103

Multiple Choice

The Great Recession of 2007-2009 altered the prior behavior of consumers in the economy by:

• A) Shifting the consumption schedule up
• B) Shifting the consumption schedule down
• C) Shifting the saving schedule down
• D) Moving the economy down along a stable consumption schedule

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Definitions:

Interest Rate

The cost of borrowing money expressed as a percentage of the amount borrowed, paid to the lender.

Short Run

A time period in economics during which at least one input is fixed while others can be varied to adjust the level of output.

Monetary Policy

Monetary policy involves the management of a nation's money supply and interest rates by the central bank to control inflation, stabilize currency, and achieve economic growth.

Fiscal Policy

Government policy that attempts to influence the economy through changes in government spending and taxes.