the economics of money, banking, and financial markets

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29. 
    

    Most Keynesians currently believe that ____.
    A) monetary policy does matter
    B) monetary policy is irrelevant
    C) fiscal policy does matter
    D) Both A and C
    Answer: D
    Diff: 1 Type: MC Page Ref: 27.1A- 4
    Skill: Recall
    Objective List: Appendix: Evaluating Empirical Evidence

    
    


30. 
    

    The early Keynesians of the 1950s and early 1960s believed that ____.
    A) monetary policy does not matter at all
    B) fiscal policy matters
    C) monetary policy does matter
    D) Both A and B
    Answer: D
    Diff: 1 Type: MC Page Ref: 27.1A- 4
    Skill: Recall
    Objective List: Appendix: Evaluating Empirical Evidence

    
    


31. 
    

    Early Keynesians believed that monetary policy ____.
    A) affected aggregate demand solely through its effect on nominal interest rates
    B) did not affect aggregate demand through nominal interest rates
    C) affected aggregate demand through many channels
    D) affected real output directly
    Answer: A
    Diff: 1 Type: MC Page Ref: 27.1A- 4
    Skill: Recall
    Objective List: Appendix: Evaluating Empirical Evidence

    
    


32. 
    

    ____ nominal interest rates do ____ indicate that the cost of borrowing is
    ____.
    A) Low; not necessarily; low
    B) High; necessarily; high
    C) Low; necessarily; low
    D) Both B and C
    Answer: A
    Diff: 1 Type: MC Page Ref: 27.1A- 6
    Skill: Recall
    Objective List: Appendix: Evaluating Empirical Evidence