How do critics of stabilization policy view the “political business cycle”?
A. They suggest shorter election cycles would improve stabilization.
B. They believe that politicians cause economic instability, due mainly to the election schedule.
C. They believe that the Fed can resist political pressure and stabilize the economy.
D. They believe that politicians do not know enough economics in order to stabilize the economy.
Answer: B
You might also like to view...
The economic life cycle describes how young people usually have higher savings rates than middle-aged people
a. True b. False Indicate whether the statement is true or false
The exchange rate of the Euro in terms of the US Dollar is currently:
(a) At parity. (b) Below parity. (c) Above parity. (d) Undefined.
Suppose the price of one euro is fixed at $1.00. A Dutch oil company discovers new oil reserves in the North Sea and offers the oil for sale. What is the impact on the foreign exchange market?
a. The dollar price of euros decreases from $1.50 to $1.00.
b. Decreasing demand for European goods shifts D2 to D1.
c. U.S. consumers demand more European goods shifting D1 to D2.
d. The quantity of euros demanded changes from Q2 to Q1.
Daily Output of Russia and Panama?RussiaPanamaGloves 40240Hats120180
Refer to Table 18.1. The opportunity cost of a hat in Panama is:
A. 1/2 of a glove. B. 3/4 of a glove. C. 4/3 gloves. D. 2 gloves.