The main goal of the Fed is to control ______ and the money supply through its monetary policy instruments.
a. short-run real interest rates
b. short-run nominal interest rates
c. long-run real interest rates
d. long-run nominal interest rates
a. short-run real interest rates
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When the average tax rate rises as income rises, this is known as progressive taxation.
Answer the following statement true (T) or false (F)
Refer to the table below. The perfectly competitive firm has a random demand with a 25 percent chance of being $5 and a 75 percent chance of being $9. What quantity should the firm produce to maximize its expected profit?
The above table summarizes the marginal cost of production at various quantity levels for a perfectly competitive firm.
A) 110
B) 100
C) 130
D) 120
A single firm that charges the monopoly price in the market earns $600. If another firm successfully enters the market, the incumbent's profits fall to $350 and the entrant earns $275. If the incumbent engages in limit pricing, its profits are $400. For what interest rate, i, is limit pricing a profitable strategy for the incumbent?
A. 0.25 < i < 0.75 B. i > 4 C. i < 0.25 D. 0.75 < i < 4
Which of the following is NOT a true statement about IMF lending?
A) The IMF can usually determine the difference between national crises and those likely to cause system-wide problems. B) Limits on borrowing have not kept up with the growth of national economies. C) The IMF does not have the funds to provide the support that a large economy might need. D) Proposals for lending expansion suggest greater IMF intervention if it can stop crises faster.