Which of the following is TRUE of the Fed's credit policy?
A. Today about 40 percent of the Fed's asset holdings are related to its conduct of credit policy.
B. The Fed's objective for its credit policy is to reduce the federal funds rate.
C. The Fed has implemented a credit policy since 1914.
D. The Fed's credit policy is extended only to U.S. financial institutions.
Answer: A
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On a graph with consumption on the vertical axis and disposable income on the horizontal axis, the slope of the line is
a. greater than one. b. equal to one. c. less than one. d. undefined.
The Consumer Price Index (CPI) differs from a chain-weighted price index in that the CPI:
A. requires calculation of GDP, while the chain-weighted index does not. B. measures the costs of a typical fixed basket of goods over time, while the chain-weighted index does not. C. allows for the goods consumed in an economy to change over time, while the chain-weighted index does not. D. compares the prices of all goods in one year to the prices of all goods in other years.
Suppose that in Belgium, the opportunity cost of producing a trombone is 8 clarinets. In Denmark, the opportunity cost of producing a trombone is 6 clarinets
a. What is the opportunity cost of producing a clarinet for Belgium? b. What is the opportunity cost of producing a clarinet for Denmark? c. Which country has a comparative advantage in the production of clarinets? d. Which country has a comparative advantage in the production of trombones?
Refer to the information provided in Table 21.9 below to answer the question(s) that follow. Table 21.9
Refer to Table 21.9. Assume that this economy produces only two goods Good X and Good Y. The value for this economy's nominal GDP in year 1 is
A. $140. B. $160. C. $180. D. $200.