The Federal Open Market Committee
a. operates with almost complete discretion over monetary policy.
b. is required to increase the money supply by a given growth rate each year.
c. is required to keep short-term interest rates within a range set by Congress.
d. is required by its charter to change the money supply using a complex formula that concerns the tradeoff between inflation and unemployment.
a
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When the leisure demand curve is relatively inelastic, the bulk of the burden of a wage tax falls on workers.
Answer the following statement true (T) or false (F)
The figure below shows an individual's demand for items from a warehouse club. All of the people who shop at the warehouse club have the same demand. If the managers use two-part pricing, the membership fee (the access fee) is ________ and the price per item (the user fee) is ________ .
A) $80; $6 per unit
B) $60; $6 per unit
C) $40; $10 per unit
D) $20; $10 per unit
When taxes are levied on transactions, irrespective of the party they are levied on,
a. The government can absorb all the consumer surplus from the transactions as revenue b. The government can absorb all the producer surplus from the transactions as revenue c. The government can absorb some of the surplus, but also creates a social loss since some of the wealth creating transactions are discouraged d. The government can absorb all of the surplus (producer and consumer)
For a government to be efficient, a project should be funded up to
A. MB = 0. B. MB = ~ C. MC = 0. D. MC = ? . E. MB = MC.