The main goals of monetary policy include all of the following EXCEPT
A) attaining the maximum sustainable growth of potential GDP.
B) keeping the unemployment rate close to the natural unemployment rate.
C) keeping the long term nominal interest rate equal to the real interest rate plus the inflation rate.
D) keeping the inflation rate low.
E) keeping the long-term interest rate at a moderate level.
C
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Suppose I have $1,000 to put into a one-year CD. Community Bank offers 5 percent interest, Floatbank offers 5.25 percent, and Squidbank offers 5.40 percent. If I place my money in Squidbank, my economic profit on the investment is
a. 5.40 percent b. 5 percent c. 0.40 percent d. 0.15 percent e. -0.40 percent
The so-called collective action problem is the reason why:
A. Taxpayers are not able to effectively counter special interest groups B. Corporations have board of directors C. We have local and national elections D. Majority voting can lead to economically inefficient outcomes