In 2008 and 2009, the quantity theory of money did a ________ job of predicting year-to-year changes in the inflation rate because ________
A) good; interest rates behaved predictably
B) poor; the Fed changed the growth rate of the quantity of money too quickly
C) poor; velocity of circulation plunged
D) good; real GDP remained stable
E) poor; the price level and the velocity of circulation did not change
C
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Government plays a role in which type of economy?
A. Only free-market economies like the United States B. Only socialist economies C. Only mixed economies D. All economies
If Mr. McLean thinks the last dollar spent on bowling yields more satisfaction than the last dollar spent on hamburgers, and McLean is a utility-maximizing consumer, he should:
a. bowl less, so the marginal satisfaction from expenditures in this area will increase. b. spend more on hamburgers, so total satisfaction from that activity will increase. c. eliminate spending on hamburgers. d. bowl more and spend less on hamburgers.
Brandon, Haley, Melissa, and Jeffrey each won $1,000 in their office football pool. According to Keynes's absolute income hypothesis, which of them would be most likely to spend the most out of their winnings?
a. Brandon, Haley, Melissa, and Jeffrey will spend the same out of their winnings b. Brandon, who earns $10,000 as a mail clerk c. Haley, who earns $25,000 as an account representative d. Melissa, who earns $50,000 as a software programmer e. Jeffrey, who earns $2 million as the CEO
Regression to the mean refers to the phenomenon in which unusual events are:
A. likely to be followed by events that are even more unusual. B. occurring on a regular basis. C. likely to be followed by events that are more normal. D. unlikely to ever occur in the first place.