Monetary Policy Actions by the Fed Are

question 77

Multiple Choice

Monetary policy actions by the Fed are

• A) more effective in a restrictive direction than they are in an expansionary direction.
• B) more effective in an expansionary direction than they are in a restrictive direction.
• C) equally effective in both expansionary and restrictive directions.
• D) only effective when coupled with fiscal policy actions.

---

Definitions:

Monopsonist

A monopsonist is a market condition where there is only one buyer in a market, giving this buyer significant control over the price and terms of purchase.

Labor Supply

The total hours that workers are willing and able to work at a given wage rate, across an economy or market.

Marginal Revenue Product

The additional revenue a firm earns by employing one more unit of input, such as labor or capital.

Variable Input

An input in the production process that can be varied in the short term to adjust output, such as labor or raw materials.