Which of the following is a possible cure for ongoing inflation?
a. The Fed could pursue anti-cyclical monetary policy.
b. The Fed could increase money supply whenever the AD curve shifts to the right.
c. The Fed could maintain a constant interest rate target regardless of economic circumstances.
d. The Fed could always try to keep the unemployment rate below the natural rate.
e. The Fed could pursue anti-cyclical fiscal policy.
A
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Certain countries remain backward because they nurture superstition and are suspicious of new technology. This argument is based on the:
A) geography hypothesis. B) location hypothesis. C) culture hypothesis. D) capital hypothesis.
Refer to Figure 8.1. If Charla and Mirna agree to pay each other $350 to install the pollution-control device on their heating systems, the payoffs in the upper-right and lower-left cells in the payoff matrix would become
A) +350, +350. B) +140, +140. C) -560, -560. D) +840, +840.