Most economists agree that a well-designed central bank would:
A. be independent of political pressure.
B. make its policy actions difficult to interpret.
C. be run by one key policy maker.
D. be accountable only to other banks.
Answer: A
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Assuming convex producer choice sets, the (marginal) technical rate of substitution is equal (in absolute value) to the ratio of input prices at any profit maximizing production plan.
Answer the following statement true (T) or false (F)
The effect on the IS curve of a reduction in taxes will be less the
A) flatter is the LM curve. B) steeper is the LM curve. C) greater the extent of "crowding out." D) greater is the marginal propensity to save.
Suppose there is an unusually large crop of apples this year. How might this affect the market for apples?
A. The demand would increase, increasing both equilibrium price and quantity. B. The supply would increase, decreasing equilibrium price and increasing equilibrium quantity. C. The demand would decrease, decreasing both equilibrium price and quantity. D. The supply would decrease, increasing equilibrium price and decreasing equilibrium quantity.
The "Big Five" macroeconomic variables with respect to agriculture
A) Represent key linkages between sectors in the food and fiber industry. B) Include the rate of interest, the unemployment rate, the rate of inflation, the rate of growth in GDP and the producer price index. C) Include the rate of foreign exchange, the rate of interest, the unemployment rate, the rate of inflation, and the rate of growth in GDP. D) None of the above.