Author Question: Which of the following best defines time inconsistency? A) the increasing inaccuracy of ... (Read 85 times)

shofmannx20 · **on:** Jun 30, 2018

Which of the following best defines time inconsistency?

A) the increasing inaccuracy of econometric models as the time horizon becomes longer
B) the tendency for the rise in output to be greater in the early years of a president's term, and smaller in the later years
C) the effects of political electoral cycles on the business cycle
D) the tendency for policy makers to deviate from a pre-announced optimal policy once agents in the economy have adjusted their behavior and expectations based on the pre-announced policy
E) the effect of economic uncertainty on short-run stabilization policy

Question 2

Refer to the information above. Given this information, the steady state rate of growth of Y/NA is

A) 0.
B) 2.
C) 3.
D) 5.
E) 16.