Mainstream macroeconomics has embraced the:
A. rational expectations view that stabilization policy is totally ineffective.
B. monetarist view that the Fed should increase the money supply at a fixed annual rate.
C. rational expectations view that expectations can shift the aggregate demand and
aggregate supply curves.
D. monetarist view that an increase in government spending crowds out an equal amount of
investment spending.
C. rational expectations view that expectations can shift the aggregate demand and
aggregate supply curves.
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This Application addresses the idea that
A) imports ultimately have a positive impact on all communities. B) imports have a bigger impact on some communities than on others. C) imports are only beneficial to a community if they are equally matched by exports from that community. D) imports have an equal impact on all communities.
The key economic difference between expected utility and expected value is that
A) expected value only considers the value of outcomes, whereas expected utility considers the tradeoff between value and risk. B) expected utility only considers the value of outcomes, whereas expected value considers the tradeoff between value and risk. C) expected utility is the maximum value obtained, whereas expect value is the mean of the values from a set of possible outcomes. D) None of the above—the differences are mathematical not economic.