Which one of the following statements best describes the monetarist view of economic stabilization?
A. Discretionary policies often do more harm than good.
B. Monetary policy should be used to fine-tune the economy.
C. Fiscal policy is more effective than monetary policy.
D. Both monetary and fiscal policy are unable to influence output, employment, and the price level.
A. Discretionary policies often do more harm than good.
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An investor wishing to minimize the risk of capital losses as a result of changing interest rates should avoid
A) U.S. savings bonds. B) U.S. Treasury notes. C) U.S. Treasury bills. D) U.S. Treasury bonds.
Autocorrelation of the error terms
A) makes it impossible to calculate homoskedasticity only standard errors. B) causes OLS to be no longer consistent. C) causes the usual OLS standard errors to be inconsistent. D) results in OLS being biased.
Tying involves a firm
a. colluding with another firm to restrict output and raise prices. b. selling two individual products together for a single price rather than selling each product individually at separate prices. c. temporarily cutting the price of its product to drive a competitor out of the market. d. requiring that the firm reselling its product do so at a specified price.
Procyclical fiscal policies:
A. reduce cyclical fluctuations in the economy, but not as effectively as countercyclical fiscal policies. B. increase cyclical fluctuations in the economy. C. reduce cyclical fluctuations in the economy more effectively than countercyclical fiscal policies. D. reduce cyclical fluctuations in the economy about as effectively as countercyclical fiscal policies.