Which of the following statements is an example of the Fed's conditional commitment policy?
A) "In these circumstances, the Committee believes that policy accommodation can be maintained for a considerable period."
B) "The Committee anticipates that weak economic conditions are likely to warrant exceptionally low levels of the federal funds rate for some time."
C) "Policy accommodation can be removed at a pace that is likely to be measured."
D) "The exceptionally low range for the federal funds rate will be appropriate at least as long as the
unemployment rate remains above 6-1/2 percent, and inflation between one and two years ahead is projected to be no more than a half percentage point above the Committee's 2 percent longer-run goal."
D
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To help pay for the cost of sport related injuries, the government imposes a tax on sellers of all sports equipment. Using the above figure, the area that equals the lost consumer surplus from this tax on sports equipment is
A) bcd. B) P1P2cd. C) P2P3ec. D) ced.
A GDP deflator of 112 means:
A. the overall price level is 12 percent higher than in the base year. B. the overall output increased by 12 percent since the base year. C. every price in the economy has gone up by 12 percent. D. the production of each good in the economy has increased by 12 percent.