Which of the following was an argument for using fiscal policy in situations like the Great Recession?
a. Congress can act quickly.
b. The size of a recessionary gap may require the use of both fiscal and monetary policy.
c. Once the federal funds rate is reduced to zero, monetary policy is less effective.
d. all of the above
a
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During the severe 2007-2009 recession, Delta Airlines sold ________ passenger tickets and ________ the prices of the tickets it did sell. The result was a $1.2 billion loss in 2009
A) fewer; raise B) more; raise C) more; cut D) fewer; cut
Instrumental Variables regression uses instruments to
A) establish the Mozart Effect. B) increase the regression R2. C) eliminate serial correlation. D) isolate movements in X that are uncorrelated with u.
In the case of a beneficial externality
a. marginal private cost is below marginal social cost. b. marginal social cost is above marginal private cost. c. marginal social cost and marginal private cost are equal. d. the free market price is below the socially efficient price.
If GDP is $8,000 billion and the money supply is $1,200 billion, velocity is approximately
a. 0.20. b. 6.67. c. 0.15. d. 5.00.