Which of the following statements about Fed management of the money supply is correct?
A) Over the past thirty years, the Fed has always stayed within its pre-announced target rates for growth in M2.
B) The most common tool used by the Fed is a change in the required ratio of reserves to deposits.
C) The rate at which the Fed lends money to banks is called the "Federal Funds rate."
D) The Fed must report each week to Congress on the conduct of monetary policy.
E) none of the above
E
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A key characteristic of the production function in the endogenous growth model presented in the text is that
A) there are increasing returns to scale in human capital. B) there are decreasing returns to scale in human capital. C) there are constant returns to scale in human capital. D) at low levels of human capital, there are increasing returns to scale in human capital, while at high levels of human capital, there are decreasing returns to scale in human capital.
The conflict between the Vice President of Marketing and her sales staff arises because
a. the sales staff are unwilling to offer discounts b. the Vice President does not want to negotiate aggressively enough to maximize profits c. the sales staff want to negotiate too aggressively d. the Vice President is more willing to offer discounts to make the sale