Inflation inertia is the result of the behavior of ________ and the existence of ________.
A. real and nominal interest rates; an output gap
B. autonomous aggregate demand; the Fed's policy reaction function
C. the central bank; automatic stabilizers
D. inflation expectations; long-term wage and price contracts
Answer: D
You might also like to view...
Many economists who accept the real business cycle explanations of economic fluctuations
a. believe that the sharp rise in the relative price of imported oil was the central cause of the deep recession in the United States in the mid-1970s. b. believe that the restrictive Federal Reserve monetary policy was the central cause of the deep recession in the United States in the mid-1970s. c. believe that the sharp rise in the relative price of imported oil was not the main cause of the deep recession in other industrialized nations in the mid-1970s. d. both a and c. d. None of the above
Social motives include all of the following EXCEPT:
A. altruism. B. fairness. C. the desire to create a favorable impression. D. risk aversion.
New growth theory puts emphasis on
A) ideas. B) experimenting with new ways of doing things. C) rearranging resources in ways that are more valuable. D) b and c E) a, b, and c
If the required reserve ratio is 10 percent, currency in circulation is $400 billion, checkable deposits are $1000 billion, and excess reserves total $1 billion, then the excess reserves-checkable deposit ratio is
A) 0.01. B) 0.10. C) 0.001. D) 0.05.