The monetary rule is the view of the:
A. Keynesians that monetary policy is most important.
B. Monetarists that monetary policy is most important.
C. Classical economists that monetary policy is most important.
D. Monetarists that the Fed should expand the money supply at a constant rate.
Answer: D
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Which of the following items has the largest price elasticity of demand?
A) food B) fruit C) oranges D) oranges from a Wal-Mart SuperCenter
An inflation-prone country
A) gains from vesting its monetary policy decisions with a "conservative" central bank. B) loses from vesting its monetary policy decisions with a "conservative" central bank. C) gains from vesting its fiscal policy decisions with a "conservative" central bank. D) loses from vesting its fiscal policy decisions with a "conservative" central bank. E) remains constant when vesting its fiscal policy decisions with a "conservative" central bank.
Suppose that there is an excess supply of economics professors. Should universities necessarily reduce salaries? What does standard economic theory suggest? What does efficiency-wage theory suggest?
The demand for the Franconian franc in the foreign exchange market equals 11,000 - 25,000e and the supply of francs in the foreign exchange market equals 9,000 + 25,000 e, where e is the nominal exchange rate expressed in U.S. dollars per franc. If the franc is fixed at 0.25 U.S. dollars per franc, then the franc is ________ and Franconia has a balance-of-payments ________.
A. overvalued; surplus of 10,500 francs B. overvalued; deficit of 10,500 francs C. undervalued; surplus of 10,500 dollars D. undervalued; deficit of 10,500 francs