Monetization of the deficit (or debt) means that
A. the government uses monetary policy to control the economy rather than fiscal policy.
B. inflation accounting corrects for price increases.
C. the Fed buys newly issued debt and increases the money supply.
D. the amount of money in circulation is equal to the size of the debt.
Answer: C
You might also like to view...
In a competitive industry, the competitive firm's profits are
a. independent of the industry in which they compete b. closely linked to the industry in which they compete c. determined only by their own differentiated product d. determined solely by the inelastic demand for their product
How does a tax cut affect the expenditure schedule?
a. It causes movement to the left along the schedule. b. It causes the schedule to shift upward. c. It causes movement to the right along the schedule. d. It causes the schedule to shift downward.
A tax is regressive if it takes a
A. Larger number of dollars as income rises. B. Smaller fraction of dollars as income rises. C. Smaller fraction of dollars as income falls. D. Larger number of dollars as income falls.
According to the law of one price, identical products should sell for the same price everywhere if
A) transactions costs are zero. B) consumers have knowledge of the prices charged for products in different markets. C) there are no tariffs or other restrictions on imports or exports. D) firms can prevent consumers from engaging in arbitrage.