According to the Taylor rule, if real GDP rises by 1 percent above potential GDP, the Fed should raise:
A. The supply of money by 10 percent
B. The velocity of money by 10 percent
C. The natural rate of unemployment from 4 percent to 5 percent
D. The Federal funds rate, relative to the current inflation rate, by 0.5 percent
D. The Federal funds rate, relative to the current inflation rate, by 0.5 percent
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"Allocative efficiency in the production of cherries means that consumers can eat all of the cherries they desire." Is this statement true or false? Explain your answer
What will be an ideal response?
Which of the following is false?
a. A true or pure monopoly exists where there is only one seller of a product for which no close substitute is available. b. The situation in which one large firm can provide the output of the market at a lower cost than two or more smaller firms is called a natural monopoly. c. In monopoly, the market demand curve may be regarded as the demand curve for the firm because it is the market for that particular product. d. A monopoly firm is a price maker, and it will pick a price that is the highest point on its demand curve.
A change in demand is said to take place when there is a
A) shift of the demand curve. B) shift of the supply curve. C) price change. D) movement along the demand curve. E) quantity change.
The study of inflation is part of:
a. Macroeconomics b. Microeconomics c. Urban economics d. Home economics