The two most severe recessions of the post-World War II era occurred in 1981-1982 and 2008-2009 . The policy responses to the two recessions were
a. very similar; expansionary fiscal policy promoted a strong recovery in both cases
b. very similar, but the recovery was nonetheless weak in both cases
c. dramatically different; tax rates were cut and monetary policy was restrictive during the earlier recession, while government spending was increased sharply and monetary policy highly expansionary during the more recent recession
d. dramatically different; tax rates were increased and monetary policy was highly expansionary during the earlier recession, while tax rates were cut and monetary policy was restrictive during the more recent recession
C
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In a market with asymmetric information, a good is said to have hidden characteristics if:
A) the consumption of the good imposes an additional cost on the society. B) the production of the good generates additional benefits to the society. C) the seller offers secret discounts to some buyers. D) the buyer or the seller observes something about the good that the other does not.
The money supply is $12.5 million, currency held by the nonbank public is $2.5 million, and the reserve—deposit ratio is 0.25
(a) What is the quantity of bank deposits? (b) What is the quantity of bank reserves? (c) What is the quantity of the monetary base? (d) What is the money multiplier (give a number)?