Christina Romer's criticism of the belief that business cycles had moderated since World War II depended on the fact that
A) estimates of the timing of business cycles since World War II had been inaccurate.
B) misuse of historical data had caused economists to understate the size of cyclical fluctuations in the post-World War II era.
C) economists had ignored the roles of the government and international trade in mitigating economic fluctuations prior to World War II.
D) economists had left out important components of GDP, such as wholesale and retail distribution, transportation, and services, in their pre-World War II estimates.
D
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When a firm with market power practices third-degree price discrimination, it charges the highest price to the group that
a. has the most elastic demand. b. has the most inelastic demand. c. purchases the highest quantity. d. purchases the lowest quantity.
The basis for international trade is
a. established trade patterns b. the size of gold holdings of two countries c. shipping and transportation costs d. absolute advantage e. comparative advantage
If the economy is in a recession and prices are relatively stable, then the discretionary fiscal policy or policies that would most likely be recommended to correct this macroeconomic problem would be:
A. increased government spending or decreased taxation, or a combination of the two actions. B. decreased government spending or decreased taxation, or a combination of the two actions. C. increased government spending or increased taxation, or a combination of the two actions. D. increased government spending or increased taxation, but not a combination of the two actions.
Describe the three major units of the Federal Reserve System and their functions.
What will be an ideal response?