Which of the following best reflects the nonactivist view of stabilization policy?
a. Monetary and fiscal policies exert little impact on the economy.
b. Discretionary policy changes often make matters worse.
c. Fiscal policy should be used to help stabilize the economy; monetary policy should not.
d. Expansionary monetary policy is the primary source of rapid economic growth.
B
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Which of the following countries provides the best example of a successful import substitution development strategy?
(a) Chile. (b) Taiwan. (c) Argentina. (d) Botswana.
What is common property? What does common property have to do with externalities?
What will be an ideal response?
Net exports
a. are the second largest component of total spending b. are already included in measures on consumption, investment, and government spending c. are a source of total spending on U.S. output d. are always positive; i.e., total exports always exceed total imports e. are always positive; i.e., total imports always exceed total exports
Which of the following is a short-run adjustment?
A. Three new firms enter the computer chip industry. B. A firm hires six new workers. C. The number of farms in Kansas increases by 10%. D. A firm opens two new plants.