The slope of the budget line, faced by an investor deciding what percentage of her portfolio to place in a risky asset, increases when the
A) standard deviation of the portfolio gets smaller.
B) standard deviation of the risky asset gets larger.
C) rate of return on the risk-free asset gets larger.
D) rate of return on the risky asset gets larger.
E) rate of return on money gets larger.
D
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The Federal Reserve uses the federal funds rate as an operating target because
A) it is an excellent indicator of the economy's underlying inflation rate. B) it is very sensitive to bank reserve level changes. C) it is determined by the Treasury. D) the Fed sets the rate directly.
The idea that hysteresis plays a role in macroeconomics implies that
a. monetary policy can have an effect on the natural rate of unemployment. b. workers can overreact to changes in monetary policy. c. stabilization policy is ineffective and counterproductive. d. fiscal policy is ineffective and counterproductive.
In the United States today, households headed by single women are more likely to be poor than:
A. married families. B. black males. C. Hispanic males. D. All of these are true.
Kuznets's research showed that the marginal propensity to consume remains constant as national income rises
Indicate whether the statement is true or false