Which of the following goals are part of the monetary "trilemma"?
a. predictable exchange rates, free movement of capital, and autonomous monetary policy
b. rising exchange rates, free movement of capital, and nationalist monetary policy
c. predictable exchange rates, autonomous monetary policy, and protectionist trade policy
d. protectionist trade policy, free movement of capital, and rising exchange rates
a. predictable exchange rates, free movement of capital, and autonomous monetary policy
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Suppose a chemical plant regularly dumps chemicals into a river that must be cleaned up before farmers located downstream can use the water on their crops
Dumping the chemicals into the river saves the chemical plant $750,000 in yearly disposal costs and cleaning the water costs farmers $825,000 each year. Explain what the benevolent social planner would like to see happen in this case.
When the Federal Reserve increases the money supply, people ________
A) decrease their purchases of bonds and other financial assets B) may, in the short run, increase their purchases of goods and services C) decrease the quantity of money holdings D) all of the above E) none of the above