Which of the following is not an appropriate policy for a central bank to follow if the economy is plagued with deflation?
A) consistently pursuing policy to promote the credibility of the central bank
B) explicitly and credibly targeting inflation
C) using expansionary monetary policy to drive down interest rates
D) increasing the target interest rate on overnight loans
D
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Gross national product is defined as
A) the value of final goods and services produced by residents of the United States even if the production takes place outside of the United States. B) the value of final goods and services produced within the United States, by United States residents. C) the value of final goods and services produced outside of the United States. D) the value of final goods and services produced within the United States.
If a firm has a monopoly in both the production and distribution of a product and the managers of both the production and distribution divisions maximize profits, all of the following are true except which one?
A) Double marginalization will occur within the firm. B) The firm will maximize its total profit. C) The firm will not earn the maximum total profit. D) A successive monopoly will occur within the firm.
Use the following table to answer the question below. Cloe is given $4 of pocket money to be spent on either hard candies or chocolates. Chocolates cost 40 cents and hard candies 80 cents each. The marginal utilities derived from the consumption of each product are as shown in the following tableNumber of ItemsMarginal Utility of ChocolatesMarginal Utility of Hard Candies160150250140340120430100520806107075508020Based on taste and preference alone, which good does Cloe prefer?
A. One cannot tell from the given data. B. chocolates C. hard candies D. Cloe equally likes chocolates and hard candies.
Refer to the above figure. If box A represents businesses and box D represents the product market in this circular flow model, then money flow in the model would be represented by:
A. (1), (3), (6), and (8). B. (1), (2), (3), and (4). C. (5), (6), (7), and (8). D. (7), (5), (4), and (2).