Exam 21: The Role of Expectations in Macroeconomic Policy

The tendency to deviate from sound long-run plans in the short-run is known as ________.

According to monetarists,such as Milton Friedman ________.

New information ought not to influence economic decision-making if ________.

Which of the following has served most recently as Chairman of the Board of Governors of the Federal Reserve System?

In 1975 the Swiss National Bank announced a policy of targeting ________.

The academic work of Ben Bernanke,recent Chairman of the Board of Governors of the Federal Reserve System,suggests that he is a firm advocate of ________.

The tying down of the price level to a nominal variable by the central bank is known as committing to ________.

How is inflation targeting consistent with the "dual mandate" of price stability and maximum employment?

Which of the following provides support for the use of discretion in economic policy-making?

Rational expectations theory suggests that ________.

Swiss attempts to target monetary aggregates ended in the 1990s because ________.

Robert Lucas spurred the rational expectations revolution in ________.

Both adaptive expectations and rational expectations are prone to error (a discrepancy between the expectation and the actual experience).In each case,how does error affect the formation of new expectations?

Greater central bank independence is positively related to ________.

Inflation targeting involves public disclosure of each of the following,except ________.

One requirement for an effective nominal anchor is ________.

Consider two similar economies hit by the same temporary negative supply shock.In the economy with the more credible monetary policy,there will be ________.

Which of the following is least likely to enhance central bank credibility?

Economists use ________ to forecast economic activity and to evaluate policy options.

The negative supply shock of 2007,compared to the shocks in 1973 & 1979,involved ________.