Which of the following should be kept in mind when policymakers consider efforts to stabilize the economy?
a. The economy responds very quickly to changes in the interest rate and changes in economic conditions are easy to predict.
b. The economy responds very quickly to changes in the interest rate and changes in economic conditions are nearly impossible to predict.
c. The economy responds to changes in the interest rate with a lag and changes in economic conditions are easy to predict.
d. The economy responds to changes in the interest rate with a lag and changes in economic conditions are nearly impossible to predict.
d
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Quick Buck and Pushy Sales produce and sell identical products and face zero marginal and average cost. Below is the market demand curve for their product. 
If Quick Buck and Pushy Sales decide to collude and work together as a monopolist with each firm producing half the quantity demanded by the market at the monopoly price, then what will be Quick Buck's economic profit?
A. $4,000 B. $3,000 C. $1,000 D. $2,000
Monetarists would likely argue that the severe recession of 2007-2009 was primarily caused by
A. too much deregulation of the financial sector in previous years. B. excessive money supply creating a bubble in some sectors of the economy. C. wide swings in investment expenditures driving erratic fluctuations in aggregate demand. D. adverse aggregate-supply shocks causing tremendous unemployment.
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What will be an ideal response?
If labor supply of unskilled workers is perfectly inelastic, then
A. the labor supply curve of unskilled workers is vertical at the total number of unskilled workers in the market. B. firms face an increasing marginal cost of hiring unskilled labor. C. firms face a horizontal value of marginal product of employment curve. D. workers will supply more hours of labor to the market when wages increase. E. the labor supply curve of unskilled workers is horizontal at the market-clearing wage.