The aim of unconventional monetary policy tools is to:
A. increase the value of the dollar.
B. stimulate the economy in coordination with fiscal policy.
C. boost liquidity and reduce interest rates when credit channels are clogged.
D. slow down liquidity and increase interest rates.
Answer: C
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Suppose you observe an increase in the equilibrium price of coffee and a decrease in the equilibrium quantity of coffee. Of the options listed below, this is most consistent with:
A. a decrease in consumer income assuming coffee is a normal good. B. an increase in consumer income assuming coffee is a normal good. C. a decrease in the cost of producing coffee. D. an increase in the cost of producing coffee.
Answer the following statement true (T) or false (F)
1) Homogeneous oligopolists tend to advertise more than do differentiated oligopolists. 2) Oligopolists use limit pricing to maximize short-run profits. 3) Both collusive and noncollusive oligopoly models suggest that price changes will be relatively infrequent in these types of industries. 4) Collusion among firms always involves formal agreements. 5) Firms are more likely to collude when the economy is in a recession.
Which of the following is the most important source of revenue for the federal budget?
A. The corporate income tax. B. Social Security and unemployment taxes. C. The federal personal income tax. D. Sales tax.
Suppose each worker must use only one shovel to dig a trench, and shovels are useless by themselves. In the short run, an increase in the price of shovels will result in
A) fewer shovels being purchased. B) more workers being hired. C) a decrease in the firm's output. D) no change in the firm's output.