Based on the Taylor rule, in the 1980s, monetary policy was
A. just about right.
B. too tight.
C. too easy.
D. too tight in the first half of the decade and too easy in the second half.
Answer: B
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Which of the following is true of marginal cost?
a. Marginal cost is the cost per unit of output produced. b. Marginal cost is the change in total cost divided by the change in total output. c. Marginal cost curve is negatively sloped at the profit-maximizing level of output. d. Marginal cost is equal to total cost divided by the quantity of output. e. Marginal cost initially increases with an increase in output but subsequently declines.
Contestable markets require that there be multiple participants in the marketplace
Indicate whether the statement is true or false
The initial development of paper money began when people used ____ as payment for goods and services
a. credit cards b. commodity money c. goldsmith receipts d. gold bullion e. gold coins
The rational expectations hypothesis implies that discretionary macropolicy may be
a. relatively effective in both the short run and long run. b. relatively effective in the short run but ineffective in the long run. c. relatively ineffective both in the short run and long run. d. effective in the long run since decision makers will continually make predictable, systematic errors.