What is the newest money supply tool available to the Fed?
a. the reserve requirement ratio
b. the discount rate
c. the interest rate on reserves held at the Fed
d. open market operations
c. the interest rate on reserves held at the Fed
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The underlying assumption of the Harrod-Domar growth model is that
a. the incremental capital-output ratio is given by k ? Y/K. b. growth is mainly determined by capital accumulation. c. growth can be sustained only if agricultural productivity rises. d. developing countries save too much and invest too little.
If the income tax system were indexed, a person whose nominal income went up from $30,000 to $33,000 in a year when the price index rose by 10 percent would pay
A. no increases in nominal income taxes. B. no increases in real income taxes. C. lower taxes in both real and nominal terms. D. higher taxes in both real and nominal terms.
In a production possibilities table, the most-valued or optimal point for society is determined by:
A. the maximization of opportunity costs. B. a combination of products at the ends of the table. C. a combination of products at the midpoint of the table. D. the equality of marginal benefits and marginal costs.
Which of the following is a government response to asymmetric information?
A) product guarantees B) external product certification C) manufacturer's warranties D) government licensing