Monetary policy that seeks to minimize the business cycle in the AS/AD model involves:
A. expansionary monetary policy throughout the business cycle.
B. contractionary monetary policy when the economy is above trend growth and expansionary policy when the economy is below trend growth.
C. contractionary monetary policy throughout the business cycle.
D. expansionary monetary policy when the economy is above trend growth and contractionary policy when the economy is below trend growth.
Answer: B
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Net investment equals
A) capital stock minus depreciation. B) gross investment minus depreciation. C) the total quantity of plant, equipment and buildings. D) gross investment/depreciation.
Public choice economists often explain low voter turnouts in terms of
A) dissatisfaction of many voters with the limited choice of candidates. B) lack of civic responsibility of the electorate. C) net costs of voting that many voters perceive. D) rational ignorance of many voters of the actual date of the elections.
Consumer surplus measures the value between the price consumers are willing to pay and the:
A. producer surplus price. B. deadweight gain price. C. actual price paid. D. preference price.
Between 1980 and 2000 the price level approximately doubled. The average annual rate of inflation over this 20-year period was about:
A. 5.5 percent. B. 4.7 percent. C. 3.5 percent. D. 2.8 percent.