According to monetarists, such as Milton Friedman ________
A) the central bank should have discretionary authority to respond to economic problems that develop over the course of the business cycle
B) the Taylor rule should effectively address the problem of inflation
C) an increase in government spending has substantially the same effects as an unanticipated increase in the money supply on domestic interest rates
D) the money supply should grow at a constant rate regardless of the state of the economy
D
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Which of the following is TRUE regarding money market mutual funds?
I. Money market mutual funds buy highly liquid assets like Treasury bills. II. Shareholders can obtain loans from money market mutual funds. A) I only B) II only C) both I and II D) neither I nor II
When the interest rate increases, the opportunity cost of holding money
a. increases, so the quantity of money demanded increases. b. increases, so the quantity of money demanded decreases. c. decreases, so the quantity of money demanded increases. d. decreases, so the quantity of money demanded decreases.
If food is on the vertical axis and shelter on the horizontal axis, the slope of the budget line is given by
A. -Ps/Pf. B. -Pf/Ps. C. Pf/Ps. D. Ps/Pf.
Which of the following could be considered a macroeconomic issue?
A. Twinkies goes bankrupt, and the entire snack industry experiences losses. B. The unemployment rate in the US falls to 7.5 percent from 7.7 percent during the month of June. C. The decision of Microsoft to offer a free upgrade to Windows 10. D. T-Mobile and MetroPCS finalize a merger.