The difference between an inside lag and an outside lag is best described as:
A. an inside lag is the time needed for monetary policy to be effective while an outside lag is the time needed for fiscal policy to be effective.
B. an inside lag is usually much longer than an outside lag.
C. an inside lag is the time between when a policy change is needed and when the Fed identifies the problem and solution, while an outside lag is the time between a policy decision and its effect on the economy.
D. an outside lag is the time between when a policy change is needed and when the Fed identifies the problem and solution, while an inside lag is the time between a policy decision and its effect on the economy.
Answer: C
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Exhibit 11-4 Supply and demand curves for food servers
If the equilibrium wage rate in Exhibit 11-4 increased, the cause could be that:
A. the wage increased. B. the marginal product of labor decreased. C. either the demand for labor increased or the supply of labor decreased. D. the price of the product produced by the labor decreased.
If this is a closed economy, what will the price of a bike be?
A. $40 B. $100 C. $140 D. $20
Required reserves of banks are a fixed percentage of their
A. loans. B. assets. C. deposits. D. All of these responses are correct.
Suppose a wave of optimism causes firms to increase investment. To stabilize output and employment, the Federal Reserve will _____
Fill in the blank(s) with correct word