1. The Long-Run Phillips Curve shows: a. That, in the long run, both the inflation rate and the unemployment rate will change in accordance with the monetary policy. b. that, in the long run, monetary policy is ineffective in changing the real economy. c. that today's labor market is affected by the decade-old monetary policy but not today's policy. d. that an expansionary monetary policy will only affect the price level in the long e. that the long-run unemployment rate is fixed and independent of the inflation rate. f. that an expansionary monetary policy can help reduce the long-term unemployment rate. 2. The Short-Run Phillips Curve shows: a. that increasing money supply can help reduce inflation but increase unemployment. b. that monetary policy has opposite effects on the unemployment rate and the inflation rate. c. that there is a negative relationship between the inflation rate and the unemployment rate in the short run. d. that reducing the Federal Discount rate will reduce the inflation rate but increase the unemployment rate. e. that the Federal Reserve can reduce both the unemployment rate and the inflation rate at the same time through monetary policy. f. that changing the reserve requirement should not affect the economy g. that monetary policy is effective in moving the real economy in the short run since it can affect the unemployment rate. 3. What is (are) the main objective(s) of monetary policy? a. Maintaining stable prices in the economy. b. Collecting interests. c. Promoting economic growth. d. Promoting employment in the labor market and keeping the unemployment rate at a low level. e. Printing the dollar to make profits. f. Regulating the financial institutions and making sure the financial system is in good conditions and stable. 4. Which of the following statements about fiscal policy is incorrect? a. An increase in government spending increases the overall demand for goods and services in the economy. b. Lowering taxes reduces business costs and increases aggregate supply. c. Although government spending may have a crowding-out effect on private investment and spending in the same field, the positive impact on the overall economy is greater. d. More transfer payments increase household income, which should stimulate consumption but reduce savings. e. An increase in government spending directly increases the aggregate demand for goods and services. f. Lowering taxes on individual taxpayers increases their disposable income. 5. To serve as a commodity money, an object must satisfy which of the following requirements? ( select all that apply) a. It should be endorsed by the government. b. It should be a commodity or token that can be divided into smaller quantities. c. It is durable. d. It should be relatively valuable. e. It has to be of standardized quality, so that the same quantity of the commodity represent the same value. f. it should not have embedded value. g. It should be generally accepted by the market participants to trade for goods and services