Economists believe that externalities can be cured by market methods
a. True
b. False
Indicate whether the statement is true or false
True
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If the Federal Reserve announces that its target for the federal funds rate is rising from 4 percent to 4.25 percent, how do you expect workers and firms to react?
A) If the Fed's announcement is not credible, workers and firms will not expect inflation to fall so they will reduce their consumption and investment spending, which will increase aggregate demand and reduce inflation. B) As long as the Fed's announcement is credible, workers and firms will reduce their consumption and investment spending, which will reduce aggregate demand and reduce inflation. C) As long as the Fed's announcement is credible, workers and firms will increase their consumption and investment spending, which will increase aggregate demand and inflation. D) Workers and firms will incorporate the increase in interest rates into their expectations of inflation, and they will expect inflation to rise as a result of Fed's policy announcement.
________ is an odorless and colorless gas, a product of the combustion of fossil fuels and burning wood. It is a leading cause of accidental poisoning in the U.S
a. Radon b. Carbon monoxide (CO) c. Nitrogen dioxide d. Sulfur dioxide
The slope of the budget constraint reveals the relative price of good X compared to good Y
a. True b. False Indicate whether the statement is true or false
Considering only the goods and forex markets, as the economy adjusts to lower rates of interest and equilibrium is restored, the level of GDP will:
A) fall. B) rise. C) become unstable. D) decline very gradually.