If firms and workers have rational expectations, including knowledge of the policy being used by the Federal Reserve
A) expansionary monetary policy is ineffective.
B) expansionary monetary policy is effective in the short run, but not the long run.
C) expansionary monetary policy is effective in the short run and the long run.
D) expansionary monetary policy is especially effective.
A
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If marginal revenue exceeds marginal cost in the short run, total revenue for the perfectly competitive firm is greater than total cost
a. True b. False Indicate whether the statement is true or false
If the demand curve is very inelastic and the supply curve is very elastic in a market, then the sellers will bear a greater burden of a tax imposed on the market, even if the tax is imposed on the buyers
a. True b. False Indicate whether the statement is true or false
What does the phrase "wages are sticky" mean?
A. Wages stick to unemployment rates. B. Wages are always changing. C. Wages never change. D. It is difficult to change wages in the short term.
To achieve long-run equilibrium in an economy with a recessionary gap, without the use of stabilization policy, the inflation rate must:
A. not change. B. increase. C. decrease. D. either increase or decrease depending on the relative shifts of AD and AS.