According to the Taylor rule, if the inflation rate is one percentage point below the target of 2%, then the Fed should:
A. Raise the real federal funds rate by one percentage point
B. Lower the real federal funds rate by one percentage point
C. Raise the real federal funds rate by half of a percentage point
D. Lower the real federal funds rate by half of a percentage point
D. Lower the real federal funds rate by half of a percentage point
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An increase in the real money supply can result from:
A) increase in the nominal money supply or an increase in the price level. B) increase in the nominal money supply or a decrease in the price level. C) decrease in the nominal money supply or an increase in the price level. D) decrease in the nominal money supply or a decrease in the price level.
In order to understand when a model may not be accurate, which is not an important action to take?
A. Identify what important details were omitted when developing a model. B. Make sure assumptions made in the model are clear and accurate. C. Test the model for accuracy. D. Make sure the model all includes all possible details.
Which of the following is an example of a normative statement?
A. The average price of a Whopper Jr. is $1.69. B. The United States ought to adopt a flat rate personal income tax. C. A higher percentage of prostitutes incarcerated in Miami test positive for AIDS when compared to registered prostitutes in Nevada. D. Average growth in real GDP per year was 1.84 percent between 2000 and 2010.
Refer to the information provided in Table 21.8 below to answer the question(s) that follow. Table 21.8
Refer to Table 21.8. The value for NNP in billions of dollars is
A. 970. B. 1,030. C. 1,060. D. 1,200.