Union contracts that have built-in cost-of-living adjustments and home mortgages that vary with the rate of inflation are
a. inappropriate ways of combating inflation
b. examples of bracket creep
c. means of implementing fiscal policy
d. examples of steps that can be taken to decrease the adverse impacts of inflation
e. examples of failed discarded policies of the 1970s
D
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A study of estimated multipliers in the major econometric models shows that
A) the government-spending multiplier tends to increase and then later decrease over time. B) the monetary multiplier is much larger than the government spending multiplier. C) there is quite a bit of variation in the value of the multipliers among the models. D) A and C are both correct.
Which of the following statements is true of bond markets?
a. A small firm can easily raise funds by issuing bonds because an investor can get a large percentage of ownership with considerably less amount of money. b. A small firm can easily raise funds by issuing bonds because investors believe that small firms have a higher potential of growth. c. A large and famous firm can easily raise funds by issuing bonds because investors are familiar with the company and are therefore more willing to consider investing in it. d. A large and famous firm can easily raise funds by issuing bonds because only large firms can afford the minimum cost of entering the bond market.