The Fed's interest rate response to the rising output ratio experienced from 1997 to 1999 is explained by
A) beneficial supply shocks which pushed down the inflation rate.
B) the Fed's efforts to help end the Asian financial crisis
C) the Fed's uncertainty about the concepts of the natural level of output and natural rate of unemployment.
D) All of the above.
D
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Because new plastic and recycled plastic are substitutes, as the price of newly produced plastic increases,
A) the demand curve for recycled plastic shifts to the left. B) there is a movement up along the demand curve for recycled plastic. C) there is a movement down along the demand curve for recycled plastic. D) the demand curve for recycled plastic shifts to the right.
An speculator who buys a fifty-year corporate bond
A) must be expecting to still be alive in fifty years. B) is subject to substantial reinvestment risk. C) is probably expecting market interest rates to increase in the future. D) is probably expecting market interest rates to decrease in the future.