In the 1990s, Fed Chair Alan Greenspan believed that the market was
a. undervalued, and evidence later showed that this was clearly correct.
b. undervalued, but whether it was remains debatable.
c. overvalued, and evidence later showed that this was clearly correct.
d. overvalued, but whether it was remains debatable.
d
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Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower
Economic theory has traditionally focused on optimality in decision-making
a. True b. False Indicate whether the statement is true or false
According to the text, which of the following is true?
A. The United States imports baseballs and exports corn. B. The United States imports auto parts and cars, but it doesn't export cars. C. The United States imports wheat, but not auto parts since it exports auto parts. D. The United States imports paper, but not computers since it exports computers.
When the spending of consumers, businesses, government, and foreigners (net exports) is less than the aggregate output level of the economy, the Keynesian model result is that:
A. output will rise. B. output will fall. C. prices will rise. D. inventories will tend to decline.