The combined efforts of the Fed and the Treasury in response to the financial crisis following the housing market crash were:
A. effective in restoring aggregate supply to its pre-crisis level, but still left the economy with sluggish aggregate demand.
B. ineffective in restoring aggregate supply to its pre-crisis level, and output remained far below potential.
C. effective in restoring aggregate supply to its pre-crisis level, but left the economy facing severely increasing inflation.
D. ineffective in restoring aggregate supply to its pre-crisis level, but output increased due to increased consumer confidence boosting aggregate demand.
A. effective in restoring aggregate supply to its pre-crisis level, but still left the economy with sluggish aggregate demand.
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Economic expansions might lead to inflation because an expansion leads to
A) a decrease in the unemployment rate, which decreases wages. B) an increase in the unemployment rate, which decreases wages. C) an increase in the unemployment rate, which increases wages. D) a decrease in the unemployment rate, which increases wages.
What role does a company like J.D. Power (which provides product satisfaction reviews) serve?
A) It provides a screening test. B) It provides a signal of quality. C) It reduces moral hazard. D) It reduces costs of giving surveys.
If the real national output is less than the equilibrium real national output producers find
A. their inventories decreasing and expand their production. B. their inventories increasing and expand their production. C. their inventories decreasing and contract their production. D. their inventories increasing and contract their production.
Unemployment compensation programs are called automatic stabilizers because payments increase during
A. both recessions and expansions. B. expansionary periods. C. periods of high unemployment. D. wartime only.