One risk of targeting inflation at zero is that ______.
a. it may damage the credibility of the central bank
b. deflation may be prevented
c. investment spending may reach unsustainable levels
d. interest rates may fall too low
d. interest rates may fall too low
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If a firm collects $90 in revenue when it sells 4 units, $100 in revenue when it sells 5 units, and $105 in revenue when it sells 6 units, then one can infer the firm is a:
A. perfect competitor. B. monopolist. C. price taker. D. profit maximizer.
The money multiplier tends to be greater when
A) individuals hold less cash. B) individuals hold more cash. C) the reserve ratio increases. D) banks hold more excess reserves.
As population of a region increases, the consumer's demand curve for a product will shift
Indicate whether the statement is true or false
If the consumer's money income were cut from $52 to $28, and the prices of J and K remain at $8 and $4 respectively, she would maximize her satisfaction by purchasing:
A. 3 units of J and 3 units of K.
B. 1 unit of J and 3 units of K.
C. 4 units of J and 1 unit of K.
D. 2 units of J and 3 units of K.