Exam 14: Stabilization Policy in the Closed and Open Economy

Which of the following is not one of the set of assumptions necessary to create the Activists' Paradise?

One of describing the debate between activists and non-activists is that

Some people support the Euro in hopes that the European Central Bank will emulate the monetary policy of the central bank of ________

If the Federal Reserve wants to control the level of interest rates

The shortest lag monetary policy faces is

Admission to the Euro required in 1997 that a country's government deficit not exceed ________ percent of GDP.

Since the mid-1980s, Federal Reserve policies have often been described as attempting

Even a monetary policy based on a rigid high-powered money growth rate rule can lack policy credibility, due in part to ________, while a policy that targets the inflation rate itself ________.

Gordon's plots of the effectiveness lags of monetary policy over the periods 1961-1975, 1976-1990, and 1991-2007 show the effectiveness lags have become ________ and the overall response of GDP to monetary policy has ________.

If the Fed announces a new policy of slower monetary growth it will result in lower inflation and no change in output only if

Sources of reduced volatility of demand shocks include all of the following except:

At the end of the 1980s, bank regulators ________ various standards by which bank performance is measured thereby ________ banks willingness to lend.

Typically the data lag is about

Non-activists believe that the IS curve is

The deregulation of thrift institutions in the 1970s and 1980s have made their deposits and thus their ability to finance mortgages ________ sensitive to movements in the market interest rate, thus ________ the monetary policy multiplier.

To non-activists, which of the following is the most useful stabilization policy?

If the demand for money is relatively stable

Non-activists believe that postwar instability is primarily the result of

Which of the following multiplier concepts is most important from the point of view of devising an activist policy?

The consensus reached in the late 1990s was that from the 1980s onward the Fed had been