A Decrease in a Broad Index of Commodity Prices Suggests

question 52

Multiple Choice

A decrease in a broad index of commodity prices suggests to the Fed that

• A) money is plentiful, and the Fed should conduct restrictive policy.
• B) money is plentiful, and the Fed should conduct expansionary policy.
• C) deflation is a potential future danger, and the Fed should conduct expansionary policy.
• D) future prices will likely increase, and the Fed should conduct expansionary policy.

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Definitions:

Moral Thought

The process of thinking about, and making judgments regarding, the rightness or wrongness of human actions.

Kohlberg

A theorist known for his work in the development of moral reasoning, proposing stages through which individuals progress as they mature.

Gilligan

A psychologist known for her work in gender differences in morality and ethical decision-making, challenging traditional theories by introducing a feminine perspective.

Spillover Hypothesis

A theory suggesting that the emotions, attitudes, and behaviors experienced in one area of life can transfer to, and affect, another area.