The depth of the 1981-1982 recession caused the Fed to abandon its experiment in targeting ________ and move to what now appears to be ________ growth rule
A) money growth, an interest rate
B) money growth, a real GDP growth
C) money growth, an unemployment rate
D) interest rates, a high-powered money growth
E) interest rates, a nominal GDP growth
B
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The sum of personal consumption expenditure, investment expenditure, government expenditure, and net export expenditure on the total amount of real output in the economy in a given period of time is called:
A) potential GDP. B) aggregate expenditure. C) real money balances. D) none of the above.
The price elasticity of demand is measured by the
A) percentage change in quantity demanded divided by the percentage change in price. B) percentage change in price divided by the percentage change in quantity demanded. C) change in quantity demanded divided by the change in price. D) change in price divided by the change in quantity demanded.
A central bank pledges to reduce the inflation rate from 20% to 5%. People reduce their inflation expectations to 10%, but the central bank only reduces inflation to 15%. What happens to the unemployment rate?
Suppose that net investment in 2016 was $20 billion and depreciation was $4 billion. Gross investment in 2016 was
A. $16 billion. B. $20 billion. C. $24 billion. D. $28 billion.