The Federal Reserve:
A. is fairly independent of the rest of government.
B. works closely with the Treasury department.
C. is easily swayed by political pressure.
D. has become an ineffective policy-making body in the last decade.
A. is fairly independent of the rest of government.
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If a firm is earning zero economic profit, then:
A. the owner will not be able to pay himself or herself a salary. B. the firm's accounting profit is equal to the firm's implicit costs. C. the firm will shut down in the long run, but will continue to operate in the short run. D. the firm's revenues are sufficient to pay its explicit costs, but not its implicit costs.
The marginal propensity to consume can best be described as:
A) consumption/income B) the impact of a change in income on GDP C) the change in income divided by the change in consumption D) the change in consumption divided by the change in income
A valid rationale for the decision NOT to include non-compensated housework in Gross Domestic Product (GDP) calculations is that
A. there is some difficulty in measuring quality and quantity. B. it would decrease the employment rate for domestic work. C. it is not a product or service. D. it would understate the value of production in the economy.
Refer to the information provided in Figure 32.3 below to answer the question(s) that follow.
Figure 32.3Refer to Figure 32.3. Suppose the economy is at Point A. According to the rational expectation theory, an unanticipated decrease in money supply
A. leaves the economy at Point A. B. moves the economy to Point B. C. moves the economy to Point C. D. moves the economy to Point D.