In practice, the Fed's policy of targeting money market conditions in the 1960s proved to be
A) countercyclical, helping to stabilize the economy.
B) procyclical, destabilizing the economy.
C) procyclical, helping to stabilize the economy.
D) countercyclical, destabilizing the economy.
B
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During 2010, a country reports that its price level fell and the money wage rate did not change. These changes led to
A) a lower real wage rate, lower profits, and a decrease in the quantity of real GDP supplied. B) a higher real wage rate, lower profits, and a decrease in the quantity of real GDP supplied. C) a higher real wage rate, higher profits, and an increase in the quantity of real GDP supplied. D) a lower real wage rate, higher profits, and an increase in the quantity of real GDP supplied. E) no change in the real wage rate and an increase in aggregate demand.
If the MPS is 0.1 and the income tax rate is 0.33, and the fraction of income spent on imports is 0.25, then the multiplier is
A) 2.5. B) 1.47. C) 1.51. D) 1.55.
When comparing across countries, the higher the rate of saving
A) the lower the level of per capita real Gross Domestic Product (GDP). B) the higher the level of per capita real Gross Domestic Product (GDP). C) the less industrialized the country. D) the lower the productivity rates.
If the Fed buys more bonds from the public, then the money supply will:
A. Decrease and the aggregate demand curve will shift to the right. B. Increase and the aggregate demand curve will shift to the right. C. Increase and the aggregate demand curve will shift to the left. D. Decrease and the aggregate demand curve will shift to the left.