If an industry has a Herfindahl index of 10,000, then
A. the industry is a single firm.
B. it is perfectly competitive.
C. it is considered a duopoly.
D. it is considered an oligopoly.
Answer: A
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To fight unemployment and close a recessionary gap, the Fed ______
A. stimulates aggregate demand by lowering the federal funds rate, which increases the quantity of money B. stimulates aggregate supply by lowering the federal funds rate, which increases potential GDP C. increase employment, which increases real GDP D. increases bank reserves, which banks use to make new loans to busi-nesses, which increases aggregate supply
Monetary policy
a. must be described in terms of interest-rate targets. b. must be described in terms of money-supply targets. c. can be described either in terms of the money supply or in terms of the interest rate. d. cannot be accurately described in terms of the interest rate or in terms of the money supply.
The variation in the rate of return one can expect from ownership of stocks will generally be smaller
What will be an ideal response?
Contractionary fiscal policy may have some undesirable consequences. Among these is
A. higher unemployment. B. higher inflation. C. higher net exports. D. larger federal deficits.