The four main policy tools the Federal Reserve System uses to influence the interest rate are setting
A) credit easing, the discount rate, setting tax rates, and setting the required reserve ratio.
B) the discount rate, open market operations, extraordinary crisis measures and setting the required reserve ratio.
C) quantitative easing, open market operations, setting tax rates, and setting the required reserve ratio.
D) quantitative easing, market interest rate and the discount rate, as well as open market operations.
E) the prime rate, open market operations, extraordinary crisis management and setting the excess reserve ratio.
B
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Non-activists believe that postwar instability is primarily the result of
A) erratic growth of private investment. B) uneven changes in real government expenditures. C) uneven changes in private consumption of durables. D) A and C are both correct.
The technique called input-output analysis relies heavily on
A. a mathematical framework that includes details for each product. B. a model that incorporates the interdependence of the economies industries. C. large amounts of production data. D. All of these responses are correct.
What are the macroeconomic policy implications of the rational expectations hypothesis? What should policy makers do and not do?
Oil producers expect that oil prices next year will be lower than oil prices this year. As a result, oil producers are most likely to
A) place more oil on the market this year, thus shifting the present supply curve of oil rightward. B) hold some oil off the market this year, thus shifting the present supply curve of oil leftward. C) place more oil on the market this year, thus increasing the quantity supplied of oil at lower but not higher prices. D) hold some oil off the market this year, thus decreasing the quantity supplied of oil at lower but not higher prices.