The Taylor rule predicted a federal funds rate which was ________ that set when Paul Volcker was chairman of the Fed, and a rate which was ________ that set when Arthur Burns chaired the Fed
A) less than; equal to B) greater than; less than
C) greater than; equal to D) less than; greater than
D
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The idea of increasing opportunity cost is reflected in the
A) bowed in shape of the production possibilities frontier. B) bowed out shape of the production possibilities frontier. C) linear shape of the production possibilities frontier. D) fact that the PPF shows there are unattainable production points. E) positive slope of the production possibilities frontier.
The larger the number of firms in an industry
A) the more intense the rivalry among firms. B) the larger the potential number of market segments. C) the easier it is to implicitly collude to fix prices. D) the greater the need for a price enforcement mechanism.
Reaction lag is the term used to express the fact that some time passes before changes in the money supply are properly translated into changes in real GDP
a. True b. False Indicate whether the statement is true or false
Which of the following could the government do to decrease the costs of inflation without lowering the inflation rate?
a. Avoid unexpected changes in the inflation rate. b. Rewrite the tax laws so that nominal gains were taxed instead of real gains. c. Make policy that would discourage firms from issuing indexed bonds. d. All of the above are correct.