If the Fed wants to permanently lower interest rates, then it should raise the rate of money growth if
A) there is fast adjustment of expected inflation.
B) there is slow adjustment of expected inflation.
C) the liquidity effect is smaller than the expected inflation effect.
D) the liquidity effect is larger than the other effects.
D
You might also like to view...
However, this type of bargaining will tend to be limited when:
A scatter diagram with the price of peanut butter on the vertical axis and the price of jelly on the horizontal axis shows a negative relationship
If the price of jelly was placed on the vertical axis and the price of peanut butter was placed on the horizontal axis, the relationship would be a A) negative relationship, also called a direct relationship. B) negative relationship, also called an inverse relationship. C) positive relationship, also called a direct relationship. D) positive relationship, also called an inverse relationship.
Distinguish between comparative advantage and absolute advantage
What will be an ideal response?
Which of the following conclusions about supply-side tax initiatives is accepted by most economists?
A. Supply-side tax cuts are likely to benefit the poor as much as the rich. B. Supply-side tax cuts will almost certainly lead to smaller budget deficits. C. Such tax cuts probably will increase aggregate supply quickly, but an increase in aggregate demand will come later. D. Tax reductions aimed at stimulating business investment are likely to have a greater impact than tax reductions aimed at getting people to work longer hours or save more.