Which Monetarist Idea Has Been Absorbed into Mainstream Macroeconomics

question 125

Multiple Choice

Which monetarist idea has been absorbed into mainstream macroeconomics?

• A) The net export effect has a stronger effect on fiscal policy than monetary policy
• B) Cuts in tax rates significantly increase the productive capacity of the economy over the historical averages
• C) Excessive growth in the money supply over long periods leads to inflation
• D) The Federal funds rate is a more important monetary target than the money supply

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Definitions:

Jointly Controlled Entities

Businesses owned and operated by two or more parties who share control and decisions, typically structured through contractual arrangements.

Contractual Agreement

This is a legally binding agreement between two or more parties with mutual obligations, often delineated in a document.

Tenants in Common

A form of co-ownership where each owner has an individual, undivided interest in the property, and upon death, their share passes to their estate rather than the other co-owners.

Strategic Financial

Involves the management of a company's finances with the aim to achieve its short-term and long-term goals using strategic planning and analysis.