1. In
recent years, many developed countries have found that inflation targeting
(increased/ decreased) the autonomy of their central banks, helping them fight inflation.
2. In
, inflation targeting was adopted in 1992, and elected officials determine the precise inflation targets that the central bank must meet.
3. Milton Friedman developed a rule for monetary policy that maintains a low rate of inflation but allows the Fed to adjust interest rates when output deviates from potential.
(True/False)
4. Price-level targeting is the same as inflation targeting.
(True/False)
5. Suppose there is a consumption tax of 20 percent. You earn $1,150, have an income tax rate of 30 percent, and save $100 after tax. Your tax will be equal to
.
6. A sales tax that is levied at all stages of production is known as a(n)
tax.
7.Most capital gains accrue to low-income individuals because there are more of them
. (True/ False)
8.
are the profit that investors earn by selling bonds, stocks, real estate, or other assets.