Which of the following is a reason for the Keynesian view that monetary policy plays a minor role in affecting the economy?
A. The money demand curve is vertical.
B. The investment curve is very steep.
C. The money demand curve is horizontal at any interest rate.
D. the monetary rule
Answer: B
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The main function of the Federal Open Market Committee is
a. to control the printing of currency. b. to determine the path of tax rates. c. to use open market operations to control the nation's money supply. d. to create and issue bonds on behalf of the Treasury. e. to oversee economic activity in the various Federal Reserve districts.
The increase in world oil prices in 1990 initially
a. caused the AS curve to shift upward as wage rates quickly adjusted b. increased the level of GDP associated with high price levels c. shifted the aggregate expenditure line upward d. caused the AS curve to shift upward due to higher costs per unit of output e. caused the AD curve to shift leftward due to an increasing interest rate
Apartment dwellers near Wrigley Field in Chicago are often able to watch the Chicago Cubs baseball team play from the roof of their apartment building, without having to pay the cost of buying a ticket. This is an example of a:
a. marginal social cost. b. negative externality. c. positive externality. d. deadweight loss.
In the case of rent-seeking behavior in a monopolistic market:
A. the net loss to society is greater than it would have been in the absence of rent-seeking behavior. B. the net loss to society is less than it would have been in the absence of rent-seeking behavior. C. the net loss to society is the same as it would have been in the absence of rent-seeking behavior. D. monopoly profit is higher than if the monopolist did not engage in rent-seeking behavior, but the net loss to society is lower.