If we are in a recession and follow conventional monetary policy, interest rates will ____ and then _____.
A. fall; fall further
B. fall; rise
C. rise; fall
D. rise; rise further
B. fall; rise
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The U.S. market for interbank borrowing and lending is called the:
a. Federal funds markets. b. Secondary market. c. Money market. d. Real Goods Market. e. Primary market.
The rapid depreciation in the dollar from 1985 to 1987 caused net exports during this period
A. to fall as the J curve would have predicted, but with a short lag (less than one year). B. to fall as the J curve would have predicted, but with a long lag (more than one year). C. to rise as the J curve would have predicted, but with a short lag (less than one year). D. to rise as the J curve would have predicted, but with a long lag (more than one year).
One of the most important thing we might do to lower our trade deficit is
A. raise the excise tax on gasoline. B. lower the personal income tax. C. prevent the Japanese from building automobile factories in the United States. D. tax our exports.
Marxists and leaders of communist economies actually often admire the market mechanism for its
A. efficiency in allocation of resources. B. fairness in distribution of output. C. maximization of net benefits for consumers. D. effectiveness in achieving high rates of growth.