Why will it difficult for the Fed to use monetary policy to direct the economy back to full employment and price stability from the recession of 2008-2009?

What will be an ideal response?


The time lags between changes in monetary policy and when the changes exert an impact on output and prices are long and variable.

Economics

You might also like to view...

A recession occurs only if there are two consecutive quarters of declining real GDP

a. True b. False

Economics

In an open economy, gross domestic product equals $3,500 billion, consumption expenditure equals $2100 billion, government expenditure equals $400 billion, investment equals $800 billion, and net exports equals $200 billion. What is national savings?

a. $200 billion b. $600 billion c. $800 billion d. $1,000 billion

Economics

Recently several food companies have adopted policies for "humane" treatment of animals to apply to providers of their meats. The food companies expect that their action will help differentiate their product from their competitors who have not adopted such policies. They expect that "differentiation" of their product will allow them to:

a) Do little to change their price because the food industry is a very competitive industry b) Lower price so they will be able to sell more product c) Raise price to cover higher input costs and get higher profit

Economics

If the first copy cost of a music video is $223,000 and the marginal cost is $0, then how many copies should the firm sell in order to break even if the price was $10 each?

A. zero B. 2,230 C. 22,300 D. 223,000

Economics