It is ____ to identify an asset bubble before it bursts ____ to identify an asset bubble after it bursts.
A. simple; and also simple
B. simple; but difficult
C. difficult; but simple
D. difficult; and also difficult
Answer: C
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To the extent that the value of money is less predictable, it becomes
A) more acceptable as a store of value. B) less acceptable as a medium of exchange. C) more acceptable as a standard of deferred payment. D) more acceptable as a unit of account.
The theorists of the rational expectations school:
a. favor monetary rules because they believe individuals know too little about how the economy works b. favor monetary rules so that workers and firms do not get any unanticipated surprises from the Fed. c. are those who favor an "active approach" to policy and reject monetary rules. d. oppose any monetary rules because they believe rules impede the natural self-correcting mechanism of the economy. e. do not believe in implementing discretionary policies.
The more money firms spend on R&D the faster the economy is expected to grow.
Answer the following statement true (T) or false (F)
Some economists argue that monopolistically competitive markets are inefficient because:
A. the firms earn economic profits in the long run. B. the firms' marginal costs and marginal revenues are not always equal. C. firms do not produce the output rate that would minimize their average total cost. D. barriers to entry are high.