If monetary and fiscal policy are going to promote economic stability, they must _________ during a recession, and _________ during an economic boom. (Fill in the blank)
a. add stimulus; apply restraint
b. apply restraint; add stimulus
c. add stimulus; add stimulus
d. apply restraint; apply restraint
A
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Loans are examples of a bank's
A) balance sheet. B) assets. C) liabilities. D) net worth.
Huey and Steve can grow potatoes or tomatoes. The table above shows the pounds of potatoes and tomatoes Huey and Steve can grow in a week. Based on the table, Huey's opportunity cost of producing one pound of tomatoes is
A) 1.5 pounds of potatoes. B) 0.66 pound of potatoes. C) 0, because he has an absolute advantage in it. D) 0, because he has a comparative advantage in it. E) 1.0 pound of potatoes.
Which of the following is NOT an economic benefit of depository institutions?
A) They borrow long and lend short. B) They create liquidity. C) They pool risk. D) They reduce the cost of monitoring borrowers.
One common effect of rent ceilings in big cities is
A) that landlords build more apartments. B) that landlords charge "key money," high payments charged to new tenants for new locks and keys. C) to equalize the quantity of apartments demanded and the quantity supplied in neighborhoods. D) to reduce the search activity by those seeking shelter.