The output losses from an adverse inflation shock are ________ and the output losses from a fall in potential output are ________.

Recent financial innovation makes the Federal Reserve's job of conducting monetary policy

A) easier, since the Fed now knows what to consider money. B) more difficult, since the Fed now knows what to consider money. C) easier, since the Fed no longer knows what to consider money. D) more difficult, since the Fed no longer knows what to consider money.

In the mathematical formulation of the short-run production function:

A) the quantity of output is usually assumed to be fixed. B) the quantity of capital employed is usually assumed to be fixed. C) the quantity of both labor and capital employed are usually assumed to be fixed. D) the quantity of both labor and capital must be allowed to vary so that output can vary in the short run.