Most economists agree that
a. fiscal policy is a more effective stabilization tool than monetary policy.
b. it is difficult to time discretionary changes in macro-policy in a manner that will promote stability.
c. monetary policy should focus on reducing unemployment, while fiscal policy should focus on the control of inflation.
d. discretionary macro-policy can easily be instituted in a manner that will promote economic stability.
B
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Suppose the demand for Pepsi is qp = 54 - 2pp + 1p. The demand for Coke is qc = 54 - 2pc + 1pp. Each firm faces a constant marginal cost of zero. Determine the Bertrand equilibrium prices
What happens to the Bertrand equilibrium prices and profits if increased differentiation causes the demand for Pepsi to become qp = 104 - 2pp + 1pc while the demand for Coke remains unchanged?
The official Federal Reserve strategy for implementing its monetary policy objectives is spelled out in the
A) Federal Reserve Board (FRB) Decree. B) Federal Reserve Bank Cooperative (FRBC) Proposal. C) Federal Advisory Committee (FAC) Statement. D) Federal Open Market Committee (FOMC) Directive.