Suppose the actual federal funds rate is equal to the rate implied by a particular inflation goal. In this situation, the Taylor rule implies that
A. monetary policy will tend to produce that inflation rate.
B. monetary policy is expansionary.
C. monetary policy is contractionary.
D. fiscal policy will result in a balanced budget.
Answer: A
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The quantity supplied of corn is the number of bushels that corn farmers want to sell under the current market conditions, while the supply of corn is a set of price-quantity pairs showing the amounts that farmers wish to sell at various hypothetical prices. According to the law of supply, a rise in the price of corn will cause a rise in the quantity supplied of corn. Non-price factors that positively affect corn growers (such as improved weather conditions, better agricultural technology, and lower costs of fertilizer, seed, labor, and other inputs) would cause a rise in the supply of corn. A rise in quantity supplied is shown by moving up and to the right along the supply curve, and a rise in supply is shown by shifting the supply curve down and to the right.
What will be an ideal response?
Following the war-time prosperity for capital and the rich during World War I (1914–18), income distribution trended towards greater equality when peace came and market forces replaced the economy's wartime concerns in determining income
distribution. Indicate whether the statement is true or false
A product in the first stage of production is defined as a(n):
a. basic need. b. investment. c. environmental product. d. primary product. e. transitory product.
Economist Charles Kindleberger (a proponent of fixed exchange rates mentioned in the text) would agree with which of the following statements?
A) It is better to leave the international value of the domestic currency to the free market forces than to have to sacrifice domestic economic goals in order to support a certain predetermined value of the currency. B) There is too great a chance that the supported exchange rates will diverge significantly from the equilibrium exchange rates, which would create persistent problems and lead to an overall decrease in international trade. C) With no certainty of what one nation's currency will be worth in terms of other nations' currencies, international trade is held below what it could be. D) a and b