Automatic stabilizers include
A. Deregulation.
B. Open market operations.
C. Discretionary tax cuts.
D. Unemployment benefits.
Answer: D
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Which of the following statements is true?
A) Marginal analysis is a key tool used while optimizing in levels. B) Comparative statics is a tool that can be used in both optimization in levels and optimization in differences. C) Marginal analysis is the comparison of economic outcomes before and after some economic variable is changed. D) Comparative statics involves calculating the incremental cost of moving from one alternative to the next best alternative.
The Taylor rule accurately predicted the changes in the federal funds target during the period
A) when Alan Greenspan was the chairman of the Federal Reserve Board. B) when Paul Volcker was the chairman of the Federal Reserve Board. C) when William McChesney Martin was the chairman of the Federal Reserve Board. D) when Arthur Burns was the chairman of the Federal Reserve Board.
Imagine Tom's annual salary as an assistant store manager is $30,000, he owns a building that rents for $10,000 yearly, and his financial assets generate $1,000 per year in interest. One day, after deciding to be his own boss, he quits his job, evicts his tenants, and uses his financial assets to establish a bicycle repair shop. To run the business, he outlays $15,000 in cash to cover all the costs involved with running the business, and earns revenues of $50,000. Tom should:
A. keep his shop going because he's earning a healthy $35,000 a year. B. keep his shop going because he's earning $5,000 more than his salary before. C. close his shop and go back to what he was doing before with his time and assets, because it was earning him $6,000 more than he's earning now. D. None of these is true.
The legally established value of a country's monetary unit in terms of another under the Bretton Woods system was called the
A) exchange rate. B) dirty float. C) special draw. D) par value.