The relationship between education and productivity is easily quantified because causation clearly flows from education to increased productivity
a. True b. False
b
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The quantity of money demanded suddenly increases at every combination of GDP and interest rate. If the Fed holds to an unchanged money supply target, the interest rate __________ and GDP __________
A) rises; falls B) rises; remains unchanged C) remains unchanged; remains unchanged D) remains unchanged; falls
What do rational expectations theorists believe? What is their critics' point of view?
Suppose an ardent environmentalist sought to preserve limited natural resources for future generations. She would more than likely be arguing that oil and gas companies use an inappropriately
A. decreasing discount rate when considering optimal resource use. B. flat discount rate when considering optimal resource use. C. high discount rate when considering optimal resource use. D. low discount rate when considering optimal resource use.
Adjusting monetary growth based on previous changes in nominal GDP
A) is relatively easy for the Fed to undertake because the implementation lag is quitelong. B) could be destabilizing because of the uncertainty of the length of impact lags. C) is an effective policy because it allows the Fed to influence future macroeconomic performance. D) raises the price level proportionately.