Discretionary policy advocates believe:
a. that there is a high cost associated with the use of a discretionary policy
b. that self-corrective forces in an economy work slowly.
c. that natural adjustments of wages and prices can help attain potential output.
d. in rational expectations.
e. that an active stabilization policy imposes troubling fluctuations in the price level and real GDP.
b
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If the market in the figure above is perfectly competitive, consumer surplus is the area ________
A) ABH B) BFGH C) ACG D) BCD E) ACE
To an American, the demand curve for euros tells
a. that Americans do not want to purchase euros b. how many euros Americans would want to buy in a given time period, at each different exchange rate c. the real interest rate on foreign currency over time d. how many Americans are willing to buy euros e. how many euros have been purchased during a given time period
In the United States, technological advances help explain persistently rising employment in the face of rising wages
a. True b. False Indicate whether the statement is true or false
Open market operations are
A. the buying of existing corporate securities in secondary markets by private citizens, banks and the Fed. B. the selling of new government securities in order to increase the money supply. C. the buying and selling of existing U.S. government securities in open private markets by the Fed. D. the actions of the Fed that are used to finance deficit financing by the government.