According to the Taylor rule, if output is above its full-employment level and inflation is less than 2%
A) the Fed should raise the Fed funds rate above 4%.
B) the Fed should reduce the Fed funds rate below 4%.
C) the Fed should make the Fed funds rate exactly 4%.
D) what the Fed should do is ambiguous.
D
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According to this Application, some economists believe that recessions which are caused by ________ normally have ________ recoveries
A) high oil prices; faster B) financial crises; faster C) high oil prices; slower D) financial crises; slower
According to the table above, ________ percent of total income is redistributed from the highest income group
A) 4.7 B) 2.3 C) 1.5 D) 3.8
Farmer Brady sells wheat in a market where sellers are price takers. Which of the following is true in regard to Farmer Brady's production and pricing decisions?
a. Farmer Brady will be able to increase the total revenue from the sale of his wheat if he increases the price of the wheat. b. Since the market dictates the price of his product, Farmer Brady will have no incentive to minimize per-unit production costs. c. Since the market dictates the price of his product, Farmer Brady has no production decisions to make. d. It would be senseless for Farmer Brady to try to increase sales by lowering the price of his product. His entire output can be sold at the market price.
Based on the graph showing how the subprime share of home mortgages grew rapidly before the big decline, what can be determined by looking at the two years before and the two years after the period when subprime mortgages’ share of the market reached its peak?
a. The share of subprime mortgages remained near the peak the entire period.
b. The share of subprime mortgages fell at the same pace that it rose.
c. The share of subprime mortgages rose faster than it fell.
d. The share of subprime mortgages fell faster than it rose.