If the economy were left on its own without the interference of government or the Fed, it would move toward an equilibrium rate of growth that would produce, with only minor interruptions, full employment without inflation. What school supports this view?

Which feature of the business cycle does the one-period model replicate with shocks to government expenditures?

A) procyclical employment B) procyclical consumption C) procyclical real wages D) countercyclical prices

Federal Reserve regulations apply

a. to all banks in the United States b. only to member banks c. only to private commercial banks d. only to national banks e. only to state banks