Which of the Following Are Reasons Why Monetarists Oppose Activist

question 1

Multiple Choice

Which of the following are reasons why monetarists oppose activist stabilization policies?
I. Monetary policy lags are so long and variable that trying to stabilize the economy using
Monetary policy can be destabilizing.
II. Monetary policy affects a nation's currency exchange rate and affects the nation's competitiveness in the global market.
III. Because of crowding-out effects, fiscal policy has no effect on GDP.
IV. Fiscal policies must be financed by government borrowing or tax increases, both of which affect aggregate demand negatively.

• A) I only
• B) I and II only
• C) I and III only
• D) I, II, III, and IV

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Definitions:

Two-Tiered System

A system or structure that has two distinct levels of operation, authority, or importance.

Class Action Arbitration

A form of arbitration that allows a group of individuals with similar legal claims to arbitrate their disputes collectively rather than individually.

Federal Arbitration Act

U.S. federal law that provides the legal foundation for the enforcement of arbitration agreements and governs the conduct of arbitration proceedings.

Summary Jury Trial

A shortened trial that serves as an alternative dispute resolution method, involving a jury which listens to a summary of the case and renders an advisory verdict.