Monetary Policy Differs from Fiscal Policy in That

question 36

Multiple Choice

Monetary policy differs from fiscal policy in that

• A)it has to be exercised by the legislature.
• B)the policy goals are very different.
• C)it is a slower process than fiscal policy.
• D)it can be implemented more quickly than fiscal policy.
• E)None of these answers is correct.

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Definitions:

Initial Endowment

The initial quantity of goods, services, or resources that an individual or entity possesses before entering into any exchange or economic activity.

Units of Quiche

A measure of output in the production of quiches, indicating the quantity produced or consumed.

Pareto Optimal Allocation

An allocation of resources from which it is impossible to reallocate so as to make any one individual better off without making at least one individual worse off.

Utility Function

A mathematical model in economics that represents an individual's preference system, used to rank choices in order of preference.