aq25Mar1 - e Automatic stabilizers are a much more...

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25 March Which of the following are reasons another ‘Great Depression’ is unlikely? a. Even Central Bankers can learn, and the Fed is unlikely to allow violent contraction of the money supply; yes, correct. b. Deposit insurance makes bank runs and widespread bank closures unlikely; yes, correct. c. Two earner families make workers less likely to be fussy about the jobs they accept. Wrong; the reverse is true. d. A large and relatively stable G implies less fluctuation in aggregate demand; yes, correct.
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Unformatted text preview: e. Automatic stabilizers are a much more important feature of the tax structure than in the 1930s; yes, correct. f. The world is less integrated so business cycles do not spread internationally as much as they did; no, wrong, the reverse is true. g. A higher proportion of households with multiple sources of income and greater assets implies consumption spending is less volatile. Yes, true....
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