Explain why economists abandoned the Humphrey-Hawkins Act of 1978 as target policy
The Humphrey-Hawkins Act set policy targets for the unemployment rate and the inflation rate, which
economists believed were unrealistic. The Phillips curve trade-offs simply did not offer the alternative
proposed in the Act.
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When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
When does the domestic government gain the MOST revenue?
A) when it imposes a tariff B) when it imposes an import quota C) when it negotiates a voluntary export restraint D) The amount of revenue it gains is the same with a tariff and a voluntary export restraint.
All of the following are strategies a firm with market power can adopt to increase it profits over time except:
A) mergers with, and acquisitions of, competing firms. B) erecting barriers to entry. C) setting price equal to the marginal costs of production. D) influencing the regulatory process.
A "specialist" is a
a. stockholder who finds buyers and sellers for specific stocks, but also operates outside of specific stock markets. b. person who works on the floor of the New York Stock Exchange and specializes in certain stocks. c. stockbroker who operates only in a particular regional stock market. d. stockbroker who specializes in the "third market."