(Solution)-The central bank has got it right. Its job is to take


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7. "The central bank has got it right. Its job is to take the punch bowl away just as the party gets roaring. And if you have 6 percent real growth a quarter like we did last year, it's quite a party you've got going." Why is it necessary to remove this punch bowl?a) to prevent inflation b) to stimulate employmentc) to finance government spending d) to match growth in the demand for money8. "Of course, a large body of economists now believes that if the 1970s taught us anything it's that macroeconomic fine-tuning is more trouble than it's worth. In effect, the economy's steering gears are so loose that unless you hit a very sharp curve, fiddling with the wheel is just as likely to do harm as good." This is an argument fora) fiscal policy b) driver educationc) constant money growth d) discretionary monetary policy9. "Followers of Milton Friedman of the University of Chicago were convinced that business cycles could be smoothed away simply by requiring the Federal Reserve to ............." Complete this clipping.a) keep the money supply constantb) increase money supply growth in recessions and decrease it in boomsc) increase money supply growth in booms and decrease it during recessionsd) increase the money supply at the same rate during booms and recessions


Solution ID:10086548 | Question answered on 16-Oct-2016

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