The monetary policies carried out by the Fed
a. must be ratified by Congress.
b. must be consistent with fiscal policies passed by Congress.
c. are sometimes inconsistent with fiscal policy.
d. must be approved by the president.
c
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Which of the following is NOT a reason that people tend to deposit their funds with banks rather than lend their funds directly to other individuals?
A) asymmetric information problems B) adverse selection problems C) moral hazard problems D) liquidity problems
If the required reserve ratio is 10 percent, currency in circulation is $400 billion, checkable deposits are $800 billion, and excess reserves total $0.8 billion, then the M1 money multiplier is
A) 2.5. B) 1.67. C) 2.0. D) 0.601.
The quantity supplied of a particular good is the amount of the good that
A. firms will actually end up buying at a particular price during a given time period. B. households are willing to consume at each particular price. C. firms are willing to sell at each price during a particular time period. D. households want firms to sell at each price during a particular time period.
Jerry sells cherry sno-cones along the boardwalk in New Jersey. During the summer this is a perfectly competitive business, and Jerry faces a perfectly elastic demand curve. If he wants to try to increase revenues he should
A. raise the price of his sno-cones to make more per sale. B. lower the price of his sno-cones to try to sell more. C. do nothing; there is nothing he can do to increase revenue. D. keep the price the same but produce more to increase sales.