Monetary policy:
A. is the use of tax increases or cuts designed to change the amount of money available for spending.
B. is the use of audits to make certain that banks follow bank policy.
C. is the use of money and credit controls to influence macroeconomic activity.
D. exists only in textbooks and has no applicability to the "real world."
Monetary policy is the use of money and credit controls to influence macroeconomic activity.
C. is the use of money and credit controls to influence macroeconomic activity.
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Vertical equity refers to the notion that individuals at all levels should be taxed equally
a. True b. False Indicate whether the statement is true or false
The figure below shows an IS-LM-FE model for an economy with fixed exchange rates. Initially the economy is at Point A, a triple intersection. Here, the FE curve is steeper than the LM curve.
To maintain the fixed exchange rate and keep the economy at Point B, the monetary authority must
A. sell foreign currency and sell domestic government bonds. B. buy foreign currency and sell domestic government bonds. C. buy foreign currency and buy domestic government bonds. D. sell foreign currency and buy domestic government bonds.