Falling output, in the short run, could be due to:
A. an increase in short-run aggregate supply.
B. a reduction in aggregate demand.
C. an increase in long-run aggregate supply.
D. an increase in aggregate demand.
Answer: B
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Which of the following is true of a country with a managed exchange rate system?
A) The central bank of the country always pursues contractionary monetary policy. B) The current account balance of the country is always positive. C) The current account balance of the country is always negative. D) The central bank of the country actively intervenes to influence the exchange rate.
Forward guidance refers to central banks
A) setting long-term interest rates. B) engaging in monetary policy to offset the negative side-effects of the government's fiscal policies. C) telling the public what future monetary policy will be. D) simultaneously reducing unemployment and inflation.