The most frequently used tool of monetary policy is
A. the discount rate.
B. reserve requirements.
C. open market operations.
D. moral suasion.
E. credit controls.
C. open market operations.
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If an economy is at the short-run equilibrium illustrated by the figure above, a discretionary fiscal policy to adjust the economy to full employment is to
A) increase the quantity of money. B) decrease taxes. C) increase government spending. D) increase taxes and decrease government spending simultaneously. E) decrease the quantity of money.
Between 1970 and 2000, the Fed:
A. never published targets or actual amounts for money growth. B. published targets for money growth and rarely hit them. C. published their targets for money growth and often hit these targets. D. published actual money growth but not targets.
The cross elasticity of demand for product X with respect to the price of product Y is -1.2. It can be inferred that X and Y are:
A. Substitute products B. Complementary products C. Luxury products D. Unrelated products
Total profit is maximized if the slope of the total profit curve is
A. positive. B. negative. C. increasing. D. zero.