When monetary policy becomes highly politicized, the policy tends to:
A. Become more effective at stabilizing the economy
B. Lose any effect at all on the economy
C. Become destabilizing, instead of promoting stability
D. Lead to rising budget surpluses
C. Become destabilizing, instead of promoting stability
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People hold money as an asset rather than other assets because
A) it holds its value. B) there is no cost to holding money as an asset. C) it grows in value. D) it is highly liquid.
The price rationing mechanism of a freely functioning market leads to the most efficient use of resources because
A) all gains from mutually beneficial trade are captured. B) the Federal Trade Commission regulates the market. C) of the rise of the legislative apparatus that supports trade. D) the Justice Department monitors market activities.
If the inflation rate for a given year is 5 percent, then $1.00 in the previous year will buy goods worth approximately $0.95 this year
a. True b. False Indicate whether the statement is true or false
The most commonly used tool of monetary policy in the U.S. is ___________ market operations.
a. open b. closed c. private d. public