When the economy slows down:
A. firms contract their operations.
B. demand for workers decreases.
C. GDP growth is slowing or negative.
D. All of these are true.
D. All of these are true.
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In the early 1950s the two new factors that stimulated the United States' economy were ___________ and ____________.
Fill in the blank(s) with the appropriate word(s).
An increase in the interest rate would induce people to
A) sell shares of stock and buy bonds, but would have no effect on their desire to hold money. B) get rid of all their money and buy stocks with it. C) sell their least liquid assets and hold more money in case interest rates go up again. D) hold a smaller fraction of their wealth in the form of money.
Decision making that seeks only solutions that are acceptable is called
a. optimizing. b. satisficing. c. benchmarking. d. maximizing.
Which of the following increases the effectiveness of monetary policy from a monetarist perspective?
A. Changing expectations. B. Unresponsive investment demands. C. The liquidity trap. D. The constant velocity of money.