The Federal Reserve Board meets roughly every 6 weeks to determine broad economic policy. It does not have to deal with the political process, which is a reason the _____ lag is shorter for monetary policy than it is for fiscal policy.
a) information
b) recognition
c) decision
d) implementation
Ans: c) decision
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In an economy in with no income taxes or imports, the multiplier equals
A) . B) . C) . D) . E) .
An increase in capital inflows will
A) increase the equilibrium exchange rate. B) increase net foreign investment. C) increase capital outflows. D) decrease capital outflows.
The idea that a consumer is limited to selecting a bundle of goods that is affordable is captured by the:
A. indifference curve. B. budget constraint. C. price changes. D. consumer equilibrium.
The change in real GDP resulting from an initial change in spending equals:
A. the initial change in spending times the nominal GDP. B. the amount of the initial change in spending. C. the initial change in spending times the multiplier. D. the initial change in spending divided by the multiplier.