CAT Question of the Day Answer the question based on the passage given below.
Consider monetary and fiscal policies. Despite decades of careful data collection and mathematical and statistical research, on many large questions we have little more than rules of thumb. For example, we know that we should lower interest rates and inject liquidity to fight stagnation, and that we should raise policy rates and banks' cash-reserve ratios to stifle inflation. Sometimes we rely on our judgment in combining interest-rate action with open-market operations. But the fact remains that our understanding of these policies' mechanics is rudimentary.
Which of the following inferences can be drawn from the above?
| OPTIONS | | |  | 1) | Our economic expertise is limited in fundamental ways. | | | 2) | Our rules of thumb are a result of decades of research. | | | 3) | We get some of our monetary and fiscal policies right by instinct. | | | 4) | None of the above. |
Tip of the Day Make it a habit to attempt mock-cat's in a single sitting. This will help to improve your concentration levels, and prepare you for the actual CAT paper. Last year's Question of the day (20-Aug-12) Find the sum of the following infinite series;  | 
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