If the Fed does not take into account the additional policy channels available in an open economy, then ________ when conducting contractionary monetary policy

A) it is likely to increase GDP too little and cause a recession
B) it is likely to decrease GDP too little and inflation will persist
C) it is likely to decrease GDP too much and cause a recession
D) it is likely to increase GDP too much and inflation will persist


C

Economics

You might also like to view...

A monopolistically competitive market has characteristics that are similar to

a. a monopoly only. b. a competitive firm only. c. both a monopoly and a competitive firm. d. neither a monopoly nor a competitive firm.

Economics

Because unemployment is a macroeconomic topic, an increase in unemployment would not be expected to have any impact on the equilibrium price or quantity in the market for an individual good

Indicate whether the statement is true or false

Economics

In the equation of exchange, the variable whose value must be computed from the other variables is the

A) price level. B) quantity of output. C) quantity of money. D) velocity of money.

Economics

Identify a critical aspect of corporate organization.

A. the capita to labor ratio B. the pricing strategies of the rival firms C. the cost structure of the firm D. the assignment of decision rights within a company

Economics