The Fed uses operating targets as well as intermediate targets because
A) the Federal Reserve Act of 1913 requires it to do so.
B) the Fed controls intermediate targets only indirectly.
C) the public is much more unfamiliar with the variables used as operating targets, so for policy to be effective intermediate targets must also be announced.
D) if one set of targets proves ineffective in attaining policy goals, the other set is available.
B
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The above figure shows the market for game day t-shirts. If the price of t-shirts is $12, then
A) the market is in equilibrium. B) there is a surplus and the price of t-shirts will fall. C) there is a shortage and the price of t-shirts will fall. D) there is a shortage and the price of t-shirts will rise. E) there is a surplus and the price of t-shirts will rise.
The product diversity resulting from monopolistic competition comes at the expense of having:
a. firms that will earn positive profits. b. firms that are too small to maximize profit. c. higher profit than would prevail under perfect competition. d. efficiency in the long run