Proponents of Fed independence maintain that
a. independence helps ensure low unemployment rates.
b. money is too important to be left to the bankers.
c. independence permits objective decisions not based on politics.
d. only the Federal Reserve knows how to act wisely.
c
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An overvalued fixed exchange rate can be maintained only as long as:
A) the country's central bank reserves are available to support currency intervention in the foreign exchange market. B) the country's central bank can increase the domestic money supply. C) the country's government increases debt financing. D) none of the above.
Darius lent Alejandro $1,000 for one year with the understanding that Alejandro would repay $1,070 . If the actual inflation rate was 7 percent, what was the real rate of interest Darius received?
a. 14 percent b. 7 percent c. 4 percent d. 0 percent e. -7 percent
Why does the slope of the aggregate supply curve change from the short run to the long run?
What will be an ideal response?
Economists have determined that there are four factors that seem to strongly affect a nation's rate of economic development. Which is NOT one of these four factors?
A. limiting the extent to which the government imposes trade barriers B. establishing a system of property rights C. supporting current industries and the jobs they provide instead of adopting new technology that brings disruptive social changes D. developing an educated population