During the financial crisis of 2007-2009, the Fed's quantitative easing program raised fears of inflation among investors, and to combat this fear, the Fed announced it would withdraw the monetary stimulus as the economy recovered
What happened to inflationary expectations during the latter part of the 2007-2009 recession? A) Inflationary expectations decreased based on the Fed's promise to withdraw stimulus money from the economy.
B) Inflationary expectations increased to record high levels despite the Fed's promise to withdraw stimulus money from the economy.
C) Inflationary expectations did increase, but the increase only returned expected inflation to its pre-recession level.
D) Inflationary expectations decreased to the point where the Fed became worried about the economy becoming deflationary.
C
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Refer to Figure 15-7. Suppose the economy is in a recession and the Fed pursues an expansionary monetary policy. Using the static AD-AS model in the figure above, this would be depicted as a movement from
A) A to E. B) A to B. C) B to C. D) C to B. E) C to D.
A market demand curve is found by
A) adding the prices each consumer would pay for each quantity. B) adding the prices and the quantities demanded by a consumer. C) adding the quantities demanded for each individual consumer at each price. D) taking the demand curve of the "representative" consumer.
The most prestigious stock market in the world is the
A) New York Stock Exchange. B) Chicago Mercantile Exchange. C) London Stock Exchange. D) Tokyo Stock Exchange.
Describe the three stages of economic analysis.
What will be an ideal response?