Why is there a lag between the Fed's actions and the economy's response?
Monetary policy is supposed to work by changing interest rates. However, people often make spending plans well in advance. So, it may take time for them to alter their decisions.
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According to this Application, one explanation for the decline in the U.S. labor force participation rate since 1999 is
A) the increase in immigration to the United States. B) the increase in outsourcing by U.S. companies. C) the decline in the overall population. D) the increasing number of retiring baby boomers.
A bank's net interest margin is
A) total interest income minus total interest expense. B) net interest income as a percent of bank equity. C) net interest income as a percent of total bank assets. D) net interest as a percent of total income.
What does Ricardian equivalence imply about the relative size of the expenditure and tax multipliers?
What will be an ideal response?
An indifference curve shows all:
A. possible equilibrium positions on an indifference map. B. equilibrium combinations of two products that are obtainable with a given money income. C. combinations of two products yielding the same total utility to a consumer. D. possible combinations of two products that a consumer can purchase, given her income and the prices of the products.