The Federal Open Market Committee
A. submits recommendations on Federal Funds Rates to Congress.
B. decides what the Federal Funds rate target will be.
C. submits recommendations on Federal Funds Rates to the President.
D. decides what mortgage interest rates will be.
Answer: B
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As the U.S. exchange rate ________, the price of U.S. imports increases and the quantity supplied of dollars ________
A) falls; does not change B) falls; decreases C) rises; increases D) rises; decreases E) falls; increases
Resolving Adam Smith’s diamond-water puzzle involves
A. realizing that price is not directly related to total utility. B. knowing that at optimal purchase, price will tend to equal marginal utility. C. knowing that, as increasing quantities of a good are consumed, marginal utility diminishes and, conversely, consuming a small quantity of a good produces high marginal utility. D. All of the responses are correct.
Which of the following provides the bulk of revenue for the federal government?
a. corporate income taxes and grants from state and local governments b. personal income and payroll taxes c. user charges and funds borrowed from the general public d. corporate income and sales taxes
It is possible for the economy to be producing at a point that lies beyond its institutional production possibilities frontier (PPF), but not its physical PPF
Indicate whether the statement is true or false