The Federal Reserve's long standing tools include
A. tax rate changes.
B. government spending policies.
C. labor regulations.
D. changing the level of the targeted interest rate.
Answer: D
You might also like to view...
Suppose that the economy is in long-run equilibrium and the government decided to engage in unexpected contractionary policy by decreasing the money supply
If we assume rational expectations, which of the following statements is correct about the effect of contractionary policy in the long run? A) The unemployment rate will decrease, real GDP will decrease and the price level will decrease. B) The unemployment rate will increase, real GDP will increase and the price level will increase. C) The unemployment rate will remain unchanged, real GDP will remain unchanged and the price level will decrease. D) The unemployment rate will remain unchanged, real GDP will remain unchanged and the price level will increase.
People who buy futures on the commodity market are
A) increasing, not reducing, their personal risk. B) reducing, not increasing, their personal risk. C) either reducing or increasing their personal risk, depending on the circumstances. D) creating added risk for others in society. E) showing they are essentially indifferent to risk.
If the Federal Reserve sells bonds, the short-run effects will be
a. an increase in the money supply and lower real interest rates. b. a decrease in the money supply and lower real interest rates. c. an increase in the money supply and higher real interest rates. d. a decrease in the money supply and higher real interest rates.
Dent 'n' Scratch Used Cars and Trucks employs 3 salesmen. Data for their sales last month are shown in this table: Cars SoldTrucks SoldLarry105Joe99Ralph312 Based on last month's data, Ralph's opportunity cost of selling a truck is selling:
A. 3 cars. B. 1/4 of a car. C. 4 cars. D. 1/3 of a car.