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Only one the answer is correct “The Federal Reserve Bank Act of 1978 requires the Fed to pursue full employment as well as low inflation, but Mr. Greenspan has said that he favors legislation to make price stability the Fed’s sole objective.” The main reason the chairman of the Fed prefers to have price stability as his sole objective is because ( ) he doesn’t care about unemployment ( ) inflation is the easiest goal for the Fed to achieve ( ) inflation is the goal over which the Fed has the greatest influence ( ) pursuing other goals could prevent the Fed from achieving the inflation goal People and countries are being ruined because of high ( ) taxes ( ) inflation ( ) uncertainty ( ) unemployment Wage/price controls allow us to ( ) control what is produced in the economy ( ) move more quickly down the long-run Phillips curve ( ) s top inflation without decreasing the rate at which money is growing ( ) deal with inflation without losing the efficiencies of the price system An incomes policy is designed to ( ) increase everyone’s real income ( ) redistribute income from the rich to the poor ( ) increase the actual income of the unemployed ( ) curb inflation without reducing aggregate demand If we are at the natural rate of unemployment, an increase in aggregate demand will lower unemployment in the short run ( ) if workers perfectly anticipate inflation ( ) regardless of workers’ inflation estimates ( ) if workers overestimate the consequent inflation ( ) if workers underestimate the consequent inflation If rapid inflation occurs in a relatively full employment economy, well-coordinated monetary and fiscal policies would involve a budget ( ) deficit and central bank increase in annual bond purchases ( ) surplus and central bank increase in annual bond purchases ( ) deficit and central bank reduction in annual bond purchases ( ) surplus and central bank reduction in annual bond purchases A decrease in the duration of unemployment benefits ( ) raises the natural rate of unemployment and raises inflation. ( ) lowers both the natural rate of unemployment and inflation. ( ) lowers the natural rate of unemployment and raises inflation. ( ) raises the natural rate of unemployment and lowers inflation.

Only one the answer is correct
“The Federal Reserve Bank Act of 1978 requires the Fed to pursue full employment as well as low inflation, but Mr. Greenspan has said that he favors legislation to make price stability the Fed’s sole objective.” The main reason the chairman of the Fed prefers to have price stability as his sole objective is because
( ) he doesn’t care about unemployment
( ) inflation is the easiest goal for the Fed to achieve
( ) inflation is the goal over which the Fed has the greatest influence
( ) pursuing other goals could prevent the Fed from achieving the inflation goal

People and countries are being ruined because of high
( ) taxes
( ) inflation
( ) uncertainty
( ) unemployment

Wage/price controls allow us to
( ) control what is produced in the economy
( ) move more quickly down the long-run Phillips curve
( ) s top inflation without decreasing the rate at which money is growing
( ) deal with inflation without losing the efficiencies of the price system

An incomes policy is designed to
( ) increase everyone’s real income
( ) redistribute income from the rich to the poor
( ) increase the actual income of the unemployed
( ) curb inflation without reducing aggregate demand

If we are at the natural rate of unemployment, an increase in aggregate demand will lower unemployment in the short run
( ) if workers perfectly anticipate inflation
( ) regardless of workers’ inflation estimates
( ) if workers overestimate the consequent inflation
( ) if workers underestimate the consequent inflation

If rapid inflation occurs in a relatively full employment economy, well-coordinated monetary and fiscal policies would involve a budget
( ) deficit and central bank increase in annual bond purchases
( ) surplus and central bank increase in annual bond purchases
( ) deficit and central bank reduction in annual bond purchases
( ) surplus and central bank reduction in annual bond purchases

A decrease in the duration of unemployment benefits
( ) raises the natural rate of unemployment and raises inflation.
( ) lowers both the natural rate of unemployment and inflation.
( ) lowers the natural rate of unemployment and raises inflation.
( ) raises the natural rate of unemployment and lowers inflation.

 

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