if a price index such as the CPI increases from 200 to 210, this represents 10% inflation

True or False

Economist J.M. Keynes was a socialist who thought government should take over production of goods and services.

True of False

According to Ben Bernanke, in normal times if the economy is growing too fast, the Fed can and should

-should not change their policy, as the Fed does not know when the economy is growing too fast.

-increase the money supply

-buy short term bonds

-raise interest rates

Normally, a central bank in a country on the gold standard holds very little gold, and this was true of the Bank of England up until 1931.

True or False

The interest rate on very short term loans between banks (LIBOR = London Interbank Offered Rate) increased during the financial crisis of 2008.

True or False