Why has the Federal Reserve chairman often been called the second most important person in terms of affecting the economy?
A) The Fed chairman has veto power over all federal spending.
B) The Fed is in control of monetary policy.
C) The Fed chairman draws the second highest salary of any official of the federal government.
D) The Fed has regulatory power over all financial markets.
B
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A krone/euro peg alone is
A) not enough to provide automatic stability in the face of any monetary shocks that shift the AA schedule. B) enough to provide automatic stability in the face of any monetary shocks that shift the AA schedule. C) not enough to provide automatic stability in the face of any monetary shocks that shift the AA schedule, provided fiscal policy will be used as well. D) enough to provide automatic stability in the face of any monetary shocks that shift the AA schedule, provided the government runs a budget deficit. E) enough to provide partial stability in the face of smaller monetary shocks that shift the AA schedule.
The primary macroeconomic cost of unemployment is
a. higher prices b. lost leisure time c. lost output d. domestic violence e. mental illness (e.g., depression)
Suppose the income tax rate is 0 percent on the first $10,000; 10 percent on the next $20,000; 20 percent on the next $20,000; 30 percent on the next $20,000; and 40 percent on all income above $70,000. Family A has income of $100,000 while Family B has income of $40,000. The marginal tax rates faced by the two families are
A) 40 percent on A and 10 percent on B. B) 40 percent on A and 20 percent on B. C) 30 percent on A and 20 percent on B. D) 30 percent on A and 30 percent on B.
A move from G to H represents
A. an increase in quantity demanded.
B. a decrease in quantity demanded.
C. an increase in demand.
D. a decrease in demand.