If monetary policymakers fear a recession resulting from increased pessimism on the part of business people, and they want to avoid the recession, they would:
A. likely lower their target rate for inflation.
B. shift the monetary policy reaction curve to the right.
C. shift the monetary policy reaction curve to the left.
D. encourage fiscal policymakers to act.
Answer: B
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Increasing productivity per person:
A. is highly desirable, as it leads to economic growth. B. is unavoidable, and macroeconomists work to prevent it. C. can harm an economy if misallocated. D. is highly undesirable, as it leads to increases in GDP per capita.
A "conservative" would most likely argue in favor of
a. tax increases when fiscal stimulus is necessary, and spending cuts when fiscal restraint is necessary. b. tax cuts when fiscal restraint is necessary, and spending cuts when fiscal stimulus is necessary. c. tax cuts when fiscal stimulus is necessary, and spending cuts when fiscal restraint is necessary. d. spending increases when fiscal expansion is necessary, and tax increases when fiscal stimulus is necessary.
In the supply-and-demand diagram of the market for peanut butter, the equilibrium point has moved down and to the right. What could have caused this?
A) a fall in the price of peanuts B) a rise in the price of peanuts C) a rise in income, assuming that peanut butter is an inferior good D) a shift in preferences toward peanut butter
In Figure 35.1, what is the opportunity cost of motorcycles in Japan?
A. 1/2 of a DVD player per motorcycle. B. 2 DVD players per motorcycle. C. 1 DVD player per motorcycle. D. 3 DVD players per motorcycle.