Policymakers are often reluctant to turn to unconventional monetary policy measures because:
A. such policies are potentially too powerful.
B. such policies require Congressional approval and Congress is often slow to act.
C. such policies require coordination with the central bankers of foreign countries.
D. they are uncertain of the quantitative impact of using them.
Answer: D
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Adopt incentive compensation
a. Under all circumstances since it is the best solution b. Only if it is effective in making the agent work harder c. Only if its results exceed its costs d. Only B&C
If the income tax system were indexed, a person whose nominal income went up from $30,000 to $33,000 in a year when the price index rose by 10 percent would pay
A. no increases in nominal income taxes. B. no increases in real income taxes. C. lower taxes in both real and nominal terms. D. higher taxes in both real and nominal terms.
Which of the following has been a significant factor in DVDs replacing video cassettes (VCs) in the retail home video market?
A) DVDs are now less than one-half the price of VCs. B) A scarcity of production capacity has curtailed the manufacture of VCs. C) Most consumers perceive DVD sound and video reproduction to be of higher quality. D) The price of DVD players has increased dramatically.
Discretionary fiscal policy transpires when the government moves to alter ______.
a. stock and bond markets b. donations and volunteerism c. taxes and government purchases d. wages and profits