Which Statement Is Broadly Agreed Upon by Modern Macroeconomists

question 124

Multiple Choice

Which statement is broadly agreed upon by modern macroeconomists?

• A) Monetary and fiscal policy can both be effective at decreasing unemployment in the short run but not in the long run.
• B) Discretionary fiscal policy is typically an effective remedy for a recessionary gap except in special circumstances.
• C) The central bank should set a specific target rate of inflation.
• D) A monetary rule should be set by the central bank.

---

Definitions:

Modified Amount

An adjusted sum of money that has been changed from its original figure for specific reasons or conditions.

Charismatic Authority

A form of leadership in which the leader's authority is derived from his or her extraordinary personal qualities and the affective devotion and emotional attachment this generates in followers.

Traditional Authority

A form of leadership in which authority is legitimized by customs, cultural traditions, and historical precedence.

Rational-legal Authority

A form of leadership where authority is legitimized by legal rules and regulations, and is exercised by officials according to their administrative roles.