The government is like a private borrower in that ________, but the government is NOT like a private borrower in that ________.
A. the government can simply increase its income to pay back debts; the government pays interest on debts
B. the government does not pay interest on debts; the government can simply increase its income to pay back debts
C. the government pays interest on debts; the government can simply increase its income to pay back debts
D. the government can simply increase its income to pay back debts; the government does not pay interest on debts
Answer: C
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Which of the following is NOT a disadvantage to inflation targeting?
A) There is a delayed signal about achievement of the target. B) Inflation targets could impose a rigid rule on policymakers. C) There is potential for larger output fluctuations. D) There is a lack of transparency.
When a household takes extra (unbudgeted) money on a trip, economists would classify this money as held for a(n):
a. speculative demand. b. transactions demand. c. emergency motive. d. precautionary demand. e. inflationary motive.
If the Federal Reserve purchases $1,000 in bonds and the reserve requirement ratio is 0.2, what will be the total change in reserves at all banks assuming there are no excess reserves?
a. +$500 b. +$5,000 c. -$500 d. -$5,000 e. +$1,000
The cost disease of personal services causes
a. the cost of health care to rise faster than the economy's rate of inflation. b. legislators to blame declining standards of quality at public hospitals on greedy doctors or administrators. c. legislators to propose price controls on insurance. d. All of the above are correct.