q1)Which of the following best explains why the FOMC adopted quantitative easing

ID: 1099884 • Letter: Q

Question

q1)Which of the following best explains why the FOMC adopted quantitative easing policies during and after the recession of 2007-2009?

Answer

a)Short-term interest rates were close to zero and traditional open market operations would no longer be effective.

b)The inflation rate was unreasonably high.

c)Short-term interest rates were very high.

d)Real GDP was above potential.

q2)Under a progressive tax system,

Answer

a)the marginal tax rate increases with increases in income.

b)the marginal tax rate remains constant with changes in income.

c)the marginal tax rate falls with increases in income.

government tax receipts increase when the economy is in a recession.

e)government tax receipts decrease when the economy is expanding.

q3)

"Supply-side" economists think that

Answer

an increase tax rates leads to a decrease in aggregate supply and a decrease in real GDP.

an increase in tax rates always leads to an increase in government tax revenue.

an increase in tax rates always leads to a decrease in government tax revenue.

an increase in tax rates leads to an increase in aggregate demand.

an increase in tax rates can lead to an increase in real GDP

a)Short-term interest rates were close to zero and traditional open market operations would no longer be effective.

b)The inflation rate was unreasonably high.

c)Short-term interest rates were very high.

d)Real GDP was above potential.

q1).a)Short-term interest rates were close to zero and traditional open market operations would no longer be effective.

q2).c)the marginal tax rate falls with increases in income.

q3).d)an increase in tax rates leads to an increase in aggregate demand.

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.