A. the same as it is for fiscal policy
B. much shorter than it is for fiscal policy
C. mush longer than it is for fiscal policy
D. unrelated to central bank action
Related Mcqs:
- If a country’s policy makers were to continuously use expansionary monetary policy in an attempt to hold unemployment below the natural rate the long-run result would be ?
A. an increase in the level of output
B. a decrease in the unemployment rate
C. an increase in the rate of inflation
D. All of these answers - In the early eighties, the Federal Reserve pursed a tight monetary policy. All else being equal. the impact of that policy was to interest rates in the United States relative to those in Europe and cause the dollar to _______ against European currencies?
A. decrease; depreciate
B. decrease; appreciate
C. increase; depreciate
D. increase; appreciate - The response lag of stabilization policy represents ?
A. the time that it takes for policy makers to recognize the existence of boom of bust
B. the time needed for parliament to agree to a tax cut.
C. the time that is necessary to put the desired policy into effect
D. the time that it takes for the economy to adjust to the new conditions after a new policy has been implemented - Time lags which often erode effectiveness of monetary and fiscal policy measures represent ?
A. delays in the response of the economy is stabilization policy
B. the foreign response to price changes
C. the change in exports and imports prices
D. the change in exchange rates - If the state Bank of Pakistan wished to pursue an expansionary monetary policy it would ?
A. increase the minimum reserve asset ratio.
B. buy government securities on the open market
C. raise interest rates
D. sell government securities on the open market - If the State Bank of Pakistan wished to pursue a tight monetary policy it would ?
A. reduce the minimum reserve asset ratio.
B. buy government securities on the open market
C. lower interest rates
D. sell government securities on the open market - Monetary policy is regulated by ?
A. Money lenders
B. Central Bank
C. Private entrepreneurs
D. Government policy - One of the transmission mechanisms of monetary policy is through consumer demand when interest rates ________ household wealth ________ and consumption _________?
A. rise; increase, increase
B. rise, falls, increase
C. rise, increase, falls
D. rise, falls, falls - Which of the following is a problem for monetary policy in a currency union ?
A. Money supply is more difficult to control in a currency union.
B. The inflation-unemployment trade-off is more unstable in a currency union
C. All of these answers describe problems for monetary policy in a currency union
D. The interest rate may be higher than is appropriate for economic conditions in some countries while it’s lower than is appropriate in some others monetary policy must be one size fits all - Expansionary monetary policy ?
A. tends to lead to an appreciation of a nation’s currency
B. tends to lead to a depreciation of a nation’s currency
C. usually has no effect on a currency’s exchange value
D. tends to lead to a depreciation of the currencies of other nations
