Question 1

The credibility of an anti-inflation announcement depends on

Accepted Answer

A)  the independence of the central bank. 
B)  past behavior of the central bank. 
C)  government budget deficits. 
D)  all of the above. 
A)  the independence of the central bank. 
B)  past behavior of the central bank. 
C)  government budget deficits. 
D)  all of the above.

Question 2

Longer term contracts between firms and suppliers would tend to make EMP less effective.

Accepted Answer

A) True 
 B)False

Question 3

If taxes rise more than expected, then the shift to the _____ by AD will be _____ than the shift to the _____ by AS in the short run.

Accepted Answer

A)  left, greater, right 
B)  left, less, right 
C)  right, greater, left 
D)  right, less, left 
A)  left, greater, right 
B)  left, less, right 
C)  right, greater, left 
D)  right, less, left

Question 4

Compared to the standard IS-LM model, the new Keynesian model implies that policy changes move equilibrium value in the same direction but at different magnitudes.

Accepted Answer

A) True 
 B)False

Question 5

In the new classical framework, fiscal policy is ineffective as long as policy is anticipated.

Accepted Answer

A) True 
 B)False

Question 6

In the new Keynesian framework, disinflation policies are costly in terms of lowered output, since expectations are not rational.

Accepted Answer

A) True 
 B)False

Question 7

A primary cause of inflation during the Revolutionary War was

Accepted Answer

A)  a lack of commitment to reduce budget deficits. 
B)  a commitment to the gold standard. 
C)  the government's reputation for allowing high inflation. 
D)  all of the above. 
A)  a lack of commitment to reduce budget deficits. 
B)  a commitment to the gold standard. 
C)  the government's reputation for allowing high inflation. 
D)  all of the above.

Question 8

If the federal funds rates falls less than expected, then output falls under the

Accepted Answer

A)  new classical model. 
B)  new Keynesian model. 
C)  both of the above. 
D)  none of the above. 
A)  new classical model. 
B)  new Keynesian model. 
C)  both of the above. 
D)  none of the above.

Question 9

If government spending rises more than anticipated, then equilibrium output should _____ and the equilibrium price level should _____ in the short run.

Accepted Answer

A)  rise, rise 
B)  rise, fall 
C)  fall, rise 
D)  fall, fall 
A)  rise, rise 
B)  rise, fall 
C)  fall, rise 
D)  fall, fall

The credibility of an anti-inflation announcement depends on

Longer term contracts between firms and suppliers would tend to make EMP less effective.

If taxes rise more than expected, then the shift to the ___ by AD will be _ than the shift to the ___ by AS in the short run.

Compared to the standard IS-LM model, the new Keynesian model implies that policy changes move equilibrium value in the same direction but at different magnitudes.

In the new classical framework, fiscal policy is ineffective as long as policy is anticipated.

In the new Keynesian framework, disinflation policies are costly in terms of lowered output, since expectations are not rational.

A primary cause of inflation during the Revolutionary War was

If the federal funds rates falls less than expected, then output falls under the

If government spending rises more than anticipated, then equilibrium output should _ and the equilibrium price level should _ in the short run.

The Financial System

Money

Interest Rates

The Economics of Interest-Rate Fluctuations

The Economics of Interest-Rate Spreads and Yield Curves

Rational Expectations, Efficient Markets, and the Valuation of Corporate Equities

Financial Structure, Transaction Costs, and Asymmetric Information

Bank Management

Innovation and Structure in Banking and Finance

The Economics of Financial Regulation

Financial Derivatives

Financial Crises: Causes and Consequences

Central Bank Form and Function

The Money Supply Process and the Money Multipliers

Monetary Policy Tools

Monetary Policy Targets and Goals

Foreign Exchange

International Monetary Regimes

Money Demand

Is-Lm

Is-Lm in Action

Aggregate Supply and Demand and the Growth Diamond

Monetary Policy Transmission Mechanisms

Inflation and Money

Filters

Exam 26: Rational Expectations Redux: Monetary Policy Implications

The credibility of an anti-inflation announcement depends on

Longer term contracts between firms and suppliers would tend to make EMP less effective.

If taxes rise more than expected, then the shift to the _____ by AD will be _____ than the shift to the _____ by AS in the short run.

Compared to the standard IS-LM model, the new Keynesian model implies that policy changes move equilibrium value in the same direction but at different magnitudes.

In the new classical framework, fiscal policy is ineffective as long as policy is anticipated.

In the new Keynesian framework, disinflation policies are costly in terms of lowered output, since expectations are not rational.

A primary cause of inflation during the Revolutionary War was

If the federal funds rates falls less than expected, then output falls under the

If government spending rises more than anticipated, then equilibrium output should _____ and the equilibrium price level should _____ in the short run.

The Financial System

Money

Interest Rates

The Economics of Interest-Rate Fluctuations

The Economics of Interest-Rate Spreads and Yield Curves

Rational Expectations, Efficient Markets, and the Valuation of Corporate Equities

Financial Structure, Transaction Costs, and Asymmetric Information

Bank Management

Innovation and Structure in Banking and Finance

The Economics of Financial Regulation

Financial Derivatives

Financial Crises: Causes and Consequences

Central Bank Form and Function

The Money Supply Process and the Money Multipliers

Monetary Policy Tools

Monetary Policy Targets and Goals

Foreign Exchange

International Monetary Regimes

Money Demand

Is-Lm

Is-Lm in Action

Aggregate Supply and Demand and the Growth Diamond

Monetary Policy Transmission Mechanisms

Inflation and Money

Filters

If taxes rise more than expected, then the shift to the ___ by AD will be _ than the shift to the ___ by AS in the short run.

If government spending rises more than anticipated, then equilibrium output should _ and the equilibrium price level should _ in the short run.