Using the Taylor rule, if the current inflation rate equals the target inflation rate and real GDP is greater than potential GDP, then the federal funds target rate ________ the sum of the current inflation rate plus the real equilibrium federal funds
rate.
A) will be greater than
B) will be less than
C) will be the same as
D) may be greater than or less than
Answer: A
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Suppose we have an economy in which G = 1100, t = 0.26, Y = 3800, and YN = 4000. The natural employment deficit is
A) 60. B) 200. C) 840. D) 286. E) -112.
In the 15th century, _____ rose to prominence in trade with areas to the east of Europe, while _____ dominated trade with the West
a. Venice; England b. Italy; Denmark c. Portugal; Spain d. France; Holland
A shift in the supply curve of bicycles resulting from higher steel prices will lead to: a. higher prices of bicycles
b. lower prices of bicycles. c. a shift in the demand curve for bicycles. d. a larger output of bicycles.
Adam Smith
A. wrote The Wealth of Nations. B. said that the entrepreneur is motivated by self-interest. C. coined the term "the invisible hand," which means that the profit motive guides economic resources which effectively promotes the public interest. D. All of the statements about Adam Smith are true.