Which government entity calculates GDP in the United States on a quarterly basis?
A) the Treasury Department
B) the Commerce Department
C) the Federal Reserve
D) all of the above
E) none of the above
B
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Economists say that the economy is at "full employment" when the
A) total unemployment rate is zero. B) structural unemployment rate is zero. C) cyclical unemployment rate is zero. D) frictional unemployment rate is zero.
How much is autonomous consumption when disposable income is $800 billion?
A. 0
B. $200 billion
C. $400 billion
D. $600 billion
Answer the following statements true (T) or false (F)
1. When the Fed sells government securities in the open market, its intent is to try to increase aggregate demand. 2. An expansionary monetary policy increases the money supply, lowers interest rates, and increases aggregate demand. 3. If the monetary authority wishes to rein in inflation, it would buy government securities in the open market. 4. In order to stimulate the economy and reduce unemployment, the Fed will set a lower target for the federal funds rate. 5. In the cause-effect chain of monetary policy an autonomous increase in investment spending when the economy is at full employment will cause the Fed to seek a lower target for the federal funds rate by buying securities in the open market.
Which expression below matches most closely the way economists go about testing their models?
A) "Consistency is the hobgoblin of small minds." B) "Seeing the results is the only way to know if you are right." C) "A bird in the hand is worth two in the bush." D) "In the long run we are all dead."