Financial Crisis Suppose That Banks Are Less Able to Raise Funds and Funds

question 185

Multiple Choice

Financial Crisis
Suppose that banks are less able to raise funds and so lend less. Consequently, because people and households are less able to borrow, they spend less at any given price level than they would otherwise. The crisis is persistent so lending should remain depressed for some time.
-Refer to Financial Crisis. How is the new long-run equilibrium different from the original one?

• A) both price and real GDP are higher.
• B) both price and real GDP are lower.
• C) the price level is the same and GDP is lower.
• D) the price level is lower and real GDP is the same.

---

Definitions:

Eating Disorder Examination

A comprehensive, semi-structured interview used for diagnosing and assessing the severity of eating disorders.

Reliability

The ability of a measurement tool to give the same measurement for a given thing every time. Its usefulness partly depends on this attribute.

Validity

The ability of a measurement tool to measure what it purports to measure. A rigid ruler would be reliable; but it would be useless as a measure of temperature.

Gay Men

Adult males who experience romantic and/or sexual attraction to other men, often discussed in the context of social, psychological, and health research.