Looking Forward in the 21st Century, the Changing Operations of the Fed

question 11

Multiple Choice

Looking forward in the 21st century, the changing operations of the Fed will, in all likelihood, place greater emphasis upon which of the following?

• A)greater freedom for small businesses
• B)a convertible gold standard
• C)lower interest rates to stimulate welfare reform
• D)greater international coordination of policies among central banks

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Definitions:

Emissions Tax

A tax imposed on the emission of pollutants, aimed at reducing environmental harm.

Optimal Tax

A tax system designed to achieve the best balance between efficiency and equity.

Marginal Social Benefit

The supplementary gain for society derived from the consumption of one extra unit of a good or service.

Marginal Social Cost

The cost to society of producing an additional unit of a good or service, including both private costs and any externalities.