During a recession, the political incentive structure will encourage politicians to
a. undertake sound economic policies that are consistent with stability and growth.
b. adopt any policies, even bad ones, that give the appearance of taking action.
c. undertake policies that promote long-term economic growth rather than short-term benefits.
d. do nothing and let the recession run its course.
B
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If Janet Yellen, Chair of the Federal Reserve Board, begins to tighten monetary policy by raising US interest rates next year, what is the likely impact on the value of the dollar?
a. The value of the dollar falls when US interest rates rise. b. The value of the dollar rises when US interest rates rise. c. The value of the dollar is not related to US interest rates. d. This is known as Purchasing Power Parity or PPP. e. The Federal Reserve has no impact at all on interest rates.
Individuals who would like a full-time job but are working only part-time are known as
a. partially unemployed. b. involuntary part-time workers. c. freelancers. d. flexible workers. e. temporary labor force.