When the exchange rate is
A) flexible, purposeful stabilization is more difficult because monetary policy has no power at all to affect domestic output and employment.
B) fixed, purposeful stabilization is less difficult because monetary policy has no power at all to affect domestic output and employment.
C) fixed, purposeful stabilization is more difficult because monetary policy has no power at all to affect domestic output and employment.
D) a crawling peg, rather than fixed, purposeful stabilization is more difficult because monetary policy has no power at all to affect domestic output and employment.
E) fixed rather than crawling peg purposeful stabilization is more difficult because fiscal policy has no power at all to affect domestic output and employment.
C
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In monopolistic competition
A) each firm's price cannot deviate from the average price of other firms. B) each firm supplies a small part of the total market output. C) one firm's actions directly affect the actions of the other firms. D) collusion is possible.
Which of the following is true for BOTH monopoly and a perfectly competitive firm?
A) The demand for the individual firm's product is perfectly elastic. B) Economic profits can be sustained indefinitely over time. C) The marginal revenue curve is horizontal at the market equilibrium price. D) Profits are maximized by producing at the level of output where marginal revenue is equal to marginal cost.
Which of the following is a lagging economic indicator?
A) Housing starts B) Employment C) Retail sales D) Inflation
When the IMF provides loans to developing countries, it often requires these countries to adopt:
A. a contractionary fiscal policy and an expansionary monetary policy. B. contractionary monetary and fiscal policies. C. expansionary monetary and fiscal policies. D. a contractionary monetary policy and an expansionary fiscal policy.