Policy Is Conducted by Discretion If Policymakers

question 6

Multiple Choice

Policy is conducted by discretion if policymakers:

• A) size up the economy and choose whatever policy seems appropriate at the time.
• B) announce in advance how policy will respond to various situations and commit themselves to following through on this announcement.
• C) maintain a constant growth rate of the money supply without making their decision public.
• D) announce and achieve a balanced government budget.
• E) announce and maintain a constant interest rate.

---

Definitions:

Average Revenue

The amount of income that a company receives per unit of sale, calculated by dividing total revenue by the number of units sold.

Total Revenue

Total revenue represents the total income a firm receives from selling its goods or services, calculated as the quantity sold multiplied by the price per unit.

Competitive Market

A market structure characterized by a large number of buyers and sellers, where no single entity has the power to significantly influence prices or market conditions.

Average Revenue

The revenue received per unit of output sold.