Which of the following are two main assumptions of The Life Cycle Hypothesis?
A. People can earn in both the first and second stages of their life. People also prefer stability in their consumption patterns.
B. People earn in the first stage of their life, but they don't earn in the second stage of their life. Interest rates are higher in the second period of a person's life than they are in the first period of a person's life.
C. People earn in the first stage of their life, but they don't earn in the second stage of their life. People also prefer stability in their consumption patterns.
D. People earn in the first stage of their life, but they don't earn in the second stage of their life. People are indifferent about the stability of their consumption patterns.
C. People earn in the first stage of their life, but they don't earn in the second stage of their life. People also prefer stability in their consumption patterns.
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If the actual reserve/deposit ratio equals 15% and the desired reserve/deposit ratio for this bank is 10%, the bank should:
A. stop making loans. B. make more loans in order to earn interest. C. do nothing because this is a profitable situation. D. request that customers withdraw deposits from the bank.
What is a TRUE statement concerning the imposition in the U.S. of a tariff on cheese?
A) It lowers the price of cheese domestically. B) It raises the price of cheese internationally. C) It raises revenue for the government. D) It will always result in retaliation from abroad. E) it leads to higher domestic demand for cheese.
Why did the Fed shift its policy target towards the federal funds rate
What will be an ideal response?
It never occurred to Keynesians that they would have to choose between policies to control unemployment and policies to control inflation
Indicate whether the statement is true or false