How does a sterilized intervention by the Fed in foreign exchange market differ from an unsterilized intervention?
What will be an ideal response?
Unlike an unsterilized intervention, a sterilized intervention is a foreign exchange intervention is accompanied by offsetting domestic open market operations that leave the monetary base unchanged.
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When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline
Every economic decision involves a trade-off because of
A. theory. B. opportunism. C. consumption. D. scarcity. E. efficiency.
When a single firm can supply a product to an entire market at a lower cost than could two or more firms, the industry is called a
a. resource industry. b. exclusive industry. c. government monopoly. d. natural monopoly.
If a hurricane were to wipe out the majority of the eastern seaboard in the United States:
A. neither the short-run nor long-run aggregate supply curves would be affected. B. only the long-run aggregate supply curve would shift left. C. only the short-run aggregate supply curve would shift left. D. the long-run and short-run aggregate supply curves would both shift left.