Monetary policy is more effective when:
A. it is contractionary.
B. it is expansionary.
C. the exchange rate is fixed.
D. the exchange rate is floating.
Answer: D
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Charles purchases 20 basketball tickets per year when his annual income is $50,000 and 25 basketball tickets when his annual income is $60,000 . Charles's income elasticity of demand for basketball ticket is
a. 0.82, and basketball tickets are a normal good. b. 0.82, and basketball tickets are an inferior good. c. 1.22, and basketball tickets are a normal good. d. 1.22, and basketball tickets are an inferior good.
Unemployment compensation payments:
A. rise during a recession and thus reduce the severity of the recession. B. rise during a recession and thus increase the severity of the recession. C. rise during inflationary episodes and thus reduce the severity of the inflation. D. fall during a recession and thus increase the severity of the recession.