From the new classical perspective, the disinflation in the early 1980s resulted in a significant recession because
a. the policy change to disinflation was unanticipated.
b. the policy was not credible.
c. inflationary expectations were backward looking.
d. None of the above
e. both a and b.
B
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If the graph shown represents Steph's budget constraint, and the price of hairbands were to increase, the slope of Steph's budget constraint would become:
A. steeper, reflecting the fact that hairbands are now relatively less expensive.
B. flatter, reflecting the fact that hairbands are now relatively more expensive.
C. steeper, reflecting the fact that earrings are now relatively less expensive.
D. flatter, reflecting the fact that earrings are now relatively more expensive.
If a bank's reserves are exactly equal to the required amount of reserves, then it has no excess reserves
a. True b. False Indicate whether the statement is true or false
Which of the following is the best example of a public good?
a. Apples. b. Cars. c. Education. d. National defense.
Which of the following statements is true with respect to a tariff on imported cheese?
a. It lowers the price of cheese. b. It lowers domestic cheese producers' profit. c. It creates tax revenues for the government. d. It cannot result in retaliation. e. It increases the amount of foreign cheese sold on domestic markets.