One of the primary causes of the banking collapse in the 1930s was ______.
a. artificial inflation of the housing market
b. depositor fears resulting in bank runs
c. the collapse of Lehman Brothers
d. very high reserve requirements set by the FOMC
b. depositor fears resulting in bank runs
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When the economy is at full employment, the
A) natural unemployment rate is equal to 0 percent. B) natural unemployment rate equals the unemployment rate. C) natural unemployment rate is equal to 10 percent. D) unemployment rate is equal to 0 percent. E) frictional unemployment rate is equal to 0 percent.
The recognition lag is
A) the time it takes for policy makers to obtain data indicating what is happening in the economy. B) the time it takes for policy makers to be sure of what the data are signaling about the future course of the economy. C) the time it takes to pass legislation to implement a particular policy. D) the time it takes for policy makers to change policy instruments once they have decided on the new policy. E) the time it takes for the policy actually to have an impact on the economy.
Table 28.1Reduction in Emissions (in tons)MC to Reduce Emissions by Steel PlantMC to Reduce Emissions by Paper Plant1$400$20025002803600320Refer to Table 28.1. Suppose the government allows these two firms to trade pollution permits. The most efficient transaction would result in
A. An increase in emissions by the steel plant and a reduction by the paper plant. B. A decrease in emissions by both plants. C. A reduction in emissions by the paper plant and no change for the steel plant. D. An increase in emissions by both plants.
When plotted with the aggregate price level on the vertical axis and output on the horizontal axis, which of the following curves slopes downward?
A. SRAS B. AD C. LRAS D. None of the above