When the Fed uses contractionary policy,
A) it causes inflation.
B) the price level rises higher than it would if the Fed did not pursue policy.
C) it does not change the price level.
D) the price level rises less than it would if the Fed did not pursue policy.
D
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In many cities, garbage collectors earn more than social workers. What could explain this wage differential?
a. Social work provides more nonmonetary rewards than garbage collecting does. b. There is a greater demand for social workers. c. There is a greater supply of trash collectors. d. Collecting garbage requires less skill. e. Social work is a less prestigious profession.
Historically the return on stocks has been higher than the return on bonds. In part this reflects the higher risk from holding stock
a. True b. False Indicate whether the statement is true or false
If increases in government spending lead to inflation, the value of the multiplier is reduced.
Answer the following statement true (T) or false (F)
The autonomy of modern central banks means that governments cannot increase their spending by:
A. issuing bonds. B. either issuing bonds or printing money; both represent debt. C. raising taxes. D. printing money.