Giving the Fed a high degree of independence means all but:
A. the Fed governors will not be as tempted by political pressure.
B. it is less likely to expand the money supply simply to make it cheaper for the government to repay its debt.
C. The federal government will not have to borrow to finance its budget deficit.
D. technocrats-rather than politicians-are in charge, which tends to increase people's trust in the stability of the dollar.
Answer: C
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Which of the following is included in the investment category under the expenditure approach to GDP accounting?
a. stocks b. bonds c. durable goods d. additions to business inventories
An explanation for why the short-run aggregate supply curve is upward-sloping is because:
a. nominal incomes are fixed. b. the quantity of real output supplied is inversely related to the aggregate supply curve. c. an increase in price will increase the supply of money. d. the capital-output ratio.