Open market operations
A) lack flexibility because only very small purchases or sales may be carried out in any given month.
B) lack flexibility because open market purchases cannot easily be offset by subsequent open market sales.
C) are more flexible than other policy tools.
D) may be carried out only on the third Friday of each month.
C
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A strategy that limits defection in a repeated prisoner's dilemma game is:
A. a cartel. B. a tit-for-tat strategy. C. a Nash equilibrium. D. an ultimatum bargaining game.
To avoid the law of diminishing control, the government could:
A. change the regulations when it is appropriate to do so. B. let the Federal Reserve decide the regulations and implement the regulations. C. treat regulation as a one-time event that is not predictable. D. leave the regulations the way they are.
One reason stagflation is difficult to recover from is because:
A. less output requires less inputs to be hired. B. prices tend to adjust more quickly downward than upward. C. wages are sticky downward. D. input prices increase with output prices.
If a country is completely self-reliant in producing goods for its own consumption needs, then
A. It achieves a higher standard of living by exporting. B. It promotes specialization. C. It consumes more than it can with trade. D. Its consumption possibilities equal its production possibilities.