Most economists feel that overly strict financial regulation from 2000 to 2006 contributed to the financial crisis of 2007–2009.
Answer the following statement true (T) or false (F)
False
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If the Fed announces a new policy of slower monetary growth it will result in lower inflation and no change in output only if
A) the policy is credible and price expectations are reduced. B) the policy is time consistent and expectations remain constant. C) the policy is time inconsistent and expectations increase. D) Both A and B are correct.
Firm's should raise the price of their goods
a. If the demand for the product is elastic b. If it acquires a firm selling a complement good c. If it acquires a firm selling a substitute good d. Both a and c
The market demand curve for a public good
a. is the horizontal sum of all individual demand curves b. is the vertical sum of all individual demand curves. c. is upward sloping d. is horizontal e. does not exist
Imagine an economy that produces capital goods and consumption goods. What will happen to its production possibilities curve if some of its existing capital stock wears out and is not replaced? How will your answer differ if more than enough capital is produced to replace the capital that wears out?