32) The time-inconsistency problem involves the ________. A) difficulties of tra

ID: 1098872 • Letter: 3

Question

32) The time-inconsistency problem involves the ________.

A) difficulties of traveling across time zones.

B) tendency to deviate from good long-run plans in the short-run.

C) use of adaptive expectations in building an economic model.

D) time lag between the implementation of policy and its ultimate and complete results.

33) The political business cycle involves the ________.

A) expenditure of substantial funds by industry lobbyists to manipulate government regulation.

B) movement of individuals from government employment to positions within the industry they had previously participated in regulating.

C) use of expansionary fiscal policy just prior to elections.

D) election of government officials who are supportive of the government sector.

34) The New Keynesian model, is Keynesian in that ________.

A) it assumes wages and prices are sticky.

B) changes in the money supply are taken to be the single most important influence on business movements.

C) the velocity of money is a constant.

D) expectations are assumed to be rational.

D) time lag between the implementation of policy and its ultimate and complete results.

B) movement of individuals from government employment to positions within the industry they had previously participated in regulating.

A) it assumes wages and prices are sticky.

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