According to Baumol and Blinder, the lag between the time a policy is implemented and the time it affects aggregate demand is
a. longer for fiscal than monetary policy.
b. longer for monetary than fiscal policy.
c. approximately equal for both.
d. influenced mainly by the size of the multiplier.
b
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Which of the following is a long-run adjustment?
A) A restaurant hires a new chef. B) A company relocate to a new headquarter in another city. C) A bank hires a new CEO. D) A company hires ten new management trainees.
Answer the following statements true (T) or false (F)
1. In the balance of payments statement, a current account deficit is always matched by a capital and financial accounts surplus. 2. When a nation is experiencing a balance-of-payments deficit, its treasury or central bank will engage in a net sale of its official reserves. 3. The purchase of a foreign hotel by a U.S. company is recorded as a credit in the financial account of the U.S. balance-of-payments statement. 4. In the dollar/yen market, if the supply of yen increases other things being equal, the dollar will appreciate. 5. Relatively high rates of U.S. inflation compared to other countries will increase the supply of, and decrease the demand for, dollars in foreign exchange markets.