The Fed is dependent upon government policy, as witnessed by its actions in the early and mid-1980s

Assume an economy is operating on its production possibilities curve, which shows the production of military and civilian goods. If the output of military goods is increased, the output of civilian goods:

A) will increase too. B) will not change. C) must decrease. D) may increase or decrease.

One model in economics is the permanent income hypothesis, which basically states that a household's expenditures will not react to a change in income unless that change in income is viewed as being permanent

How would you use this model to predict the expenditure patterns over the course of a year of a real estate agent who only sells homes during the months of April through July?