Which of the following is not a limitation to monetary policy?
a. The fact that fiscal policy is sometimes at odds with monetary
b. The world has become global in all markets including financial markets, and the Fed does not have control over international banks or non-member banks.
c. Because the Federal Reserve System is made up of twelve branches, it is essentially very difficult to get a decision enacted by the Board of Governors.
d. Monetary policy has to be carried out through the commercial banking system.
c
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When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
Suppose it costs a farmer $1.00 to produce 1 unit of corn, $2.10 to produce 2 units of corn, and $3.30 to produce 3 units of corn. What's the marginal cost of producing 2 units of corn?
A) 0 B) 10 cents C) $1.10 D) $2.00 E) $2.10
The income elasticity of demand is ________ for a normal good and ________ for an inferior good
A) positive; positive B) positive; negative C) negative; positive D) negative; negative
Monopolies exist due to
A) patents. B) government franchises. C) cost factors. D) all of these choices contribute to the power of a monopoly.