The credit spread is countercyclical and coincident, suggesting that a sudden increase in financial frictions is most likely ________
A) when the economy has been expanding for some time
B) after the economy has turned into a recession
C) during the recovery phase of the business cycle
D) when expected inflation is declining
A
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Tight monetary policy will ________ net exports as a result of a ________ currency.
A. increase; weaker B. increase; stronger C. decrease; stronger D. decrease; weaker
If a firm is a price taker in both the input and output markets, its marginal revenue product of labor is given by:
a. the price of its output times the labor's marginal physical productivity. b. the marginal value product of labor. c. the marginal revenue product of capital times the ratio of the wage rate to the rental rate on capital. d. all of the above.
When there is an excess quantity supplied
A) the market is in equilibrium. B) quantity demanded is greater than quantity supplied. C) quantity demanded is less than quantity supplied. D) prices will remain stable.
To estimate the cost of the September 11, 2001 terrorist attacks, which of the following concepts would be used to calculate the value of lost lives?
A. The fallacy of composition B. The concept of acceptable risk C. The total value of lost earnings D. The present value of lost earnings