When the economy suffers a temporary negative supply shock and the central bank responds by changing the autonomous component of monetary policy to keep inflation at the target inflation rate, then
A) aggregate output drops in the short run.
B) output will return to potential output over time.
C) aggregate output is stabilized.
D) all of the above.
E) both A and B.
E
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In the figure above, how can the economy represented by the production possibilities frontier move from point C to point F?
A) Increase the available amount of resources. B) Increase the level of technology. C) Redistribute the existing resources to produce more apples and fewer oranges. D) First move to point B and then move to point F.
Jamal maximizes utility by allocating his time among leisure, market work, and household work so that
a. expected marginal utility is equal among all three b. expected total utility per hour is equal among all three c. expected marginal utility per hour is equal among all three d. the maximum amount of goods and services can be acquired e. expected total utility of each use is equal
Market risk is:
A. risk that is broadly shared by the entire market or economy. B. risk that is unique to a particular company or asset. C. likely to be predictable, and generally reflected in interest rates. D. the reason the economy suffers inflation from time to time.
When economists disagree, it is often over what type of issues?