A nation's central bank:
A. is the bank that holds deposits for the most customers in the nation.
B. determines the nation's fiscal policy.
C. controls the nation's monetary policy.
D. is the bank that has the most neutral lending policy.
Answer: C
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Refer to the above figure. If the aggregate demand curve shifts beyond AD5, which of the following would we NOT expect?
A) strong demand-pull inflation B) no increase in real Gross Domestic Product (GDP) C) strong and rapid increases in the price level D) increases in real net domestic product
Barriers to entry do not occur when:
a. economies of scale in production exist in an industry. b. firms requires a professional license or franchise agreement. c. the firm that introduces a product is granted a patent. d. a firm controls a scarce resource. e. diseconomies of scale in production exist in an industry.
The price charged by oligopolists will
a. equal the equilibrium price in a price-takers market if the oligopolists collude. b. equal the monopoly price if the oligopolists do not collude. c. generally fall between the monopoly and competitive market equilibrium prices. d. be the same whether the oligopolists cooperate with one another or not; only profit is affected.
If efficiency wages became more common,
a. both the long-run Phillips curve and the long-run aggregate supply curve would shift right. b. both the long-run Phillips curve and the long-run aggregate supply curve would shift left. c. the long-run Phillips curve would shift right, and the long-run aggregate supply curve would shift left. d. the long-run Phillips curve would shift left, and the long-run aggregate supply curve would shift right.