The strongest point in the case against activism is that
A) so many segments of private aggregate demand are unstable.
B) activist policy, even if desirable, is too difficult to perform well enough.
C) private aggregate demand is basically stable.
D) policy rules for targets have been proven by the record of the Fed in the 1980s and 1990s to be perfectly feasible.
B
You might also like to view...
In a small Asian country, it is estimated that changing the level of capital from $8 million to $12 million will increase real GDP from $4 million to $6 million
What level of GDP would you expect the economy to be able to reach if spending on capital continued to rise to $16 million, assuming no technological change and no change in the hours of work? A) GDP would increase further by exactly $8 million. B) GDP would increase further by exactly $2 million. C) GDP would increase further, but by less than $2 million. D) GDP would increase further by more than $2 million
Refer to Figure 16-1. Suppose the economy is in short-run equilibrium below potential GDP and no fiscal or monetary policy is pursued. Using the static AD-AS model in the figure above, this would be depicted as a movement from
A) A to E. B) A to B. C) B to A. D) B to C. E) C to B.