Suppose the inflation rate target is zero and the long-run federal funds target is also zero. If the inflation rate is 4 percent and the output gap is ‒2 percent, the federal funds rate set by the Taylor rule is ________. 5 percent 6 percent 2 percent 8 percent
Suppose the inflation rate target is zero and the long-run federal funds target is also zero. If the inflation rate is 4 percent and the output gap is ‒2 percent, the federal funds rate set by the Taylor rule is ________.
- 5 percent
- 6 percent
- 2 percent
- 8 percent
Robert is a doctor who earns an average hourly wage of $80. His wife is a teacher and earns an average hourly wage of $35. His daughter works in her college library and earns $12 per hour, while his son is a lawyer and earns $60 per hour. If one of them must stay at the house on a working day to look after their ailing pet, who can do it at the lowest
- Robert
- Robert's wife
- Robert's daughter
- Robert's son
Edward lives in England, and he makes a donation of $100,000 to a charitable organization in the United States. Edward's donation will be considered ________.
- a subsidy
- foreign aid
- a transfer payment to foreigners
- a factor payment to foreigners
Everything else equal, if a country has exports of $15 billion and imports of $16 billion, it follows that the country has a ________.
- current account deficit and a financial account deficit
- current account surplus and a financial account deficit
- current account surplus and a financial account surplus
- current account deficit and a financial account surplus
Which of the following is most likely to cause a rightward shift of the
- An increase in the demand for U.S. products in China
- A decrease in the demand for U.S. products in China
- An increase in the demand for Chinese products in the United States
- A decrease in the demand for Chinese products in the United States
If the ratio of the dollar price of a U.S. toy to the dollar price of the same toy sold in China is greater than 1, U.S. toys are ________ than Chinese toys and retailers in the United States should ________.
- cheaper; buy the toys from American suppliers
- cheaper; buy the toys from Chinese suppliers
- more expensive; buy the toys from American suppliers
- more expensive; buy the toys from Chinese suppliers
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