Exam 22:Understanding Business Cycle Fluctuations

Policymakers could neutralize all of the following except:

Comparing monetary and fiscal policy:

Unemployment insurance and the proportional nature of the tax system are examples of:

Explain the view called real business cycle theory.

Why could it be effectively argued that the temporary increase in inflation from the spending for the Vietnam War was made permanent by the Fed?

Real business cycle theory explains fluctuations in output through:

The longest recession since the 1940's began in:

Why would most economists default usually first to monetary policy for stabilization before using fiscal policy?

Globalization and trade:

If the monetary policy reaction curve has a relatively steep slope, the dynamic aggregate demand curve is likely to have a:

What is meant by saying that automatic fiscal policy is countercyclical?

Policymakers can neutralize:

Which of the following is not correct with regard to the definition of a recession as used by the NBER?

In practice, it is difficult to keep inflation and output from fluctuating when aggregate expenditures change because:

What tool is available to monetary policymakers to shift the short-run aggregate supply curve to the left following a positive inflation shock?

Higher potential output levels:

According to the NBER, a severe decline in economic activity that lasted less than two quarters:

Stagflation is a term that usually describes an economy experiencing:

If the monetary policy reaction curve has a relatively flat slope, the dynamic aggregate demand curve is likely to have a:

Which of the following statements is most correct?