On average, the greater the unexpected decline in aggregate demand
A. the greater is the resulting inflation.
B. the greater is the resulting deflation.
C. the weaker is the resulting deflation.
D. the greater is the rise in the price level.
Answer: B
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The goal of expansionary monetary policy is to:
A. reduce interest rates to stimulate the economy. B. increase interest rates to stimulate the economy. C. reduce interest rates to slow down the economy. D. increase interest rates to slow down the economy.
Felix always consumes exactly four cookies with a glass of milk. Felix's indifference curves for cookies and milk would be:
A. linear. B. L-shaped. C. convex. D. positively-sloped.
Suppose the government cuts taxes to keep the economy's cyclically adjusted budget in balance when the economy is expanding. The government is engaging in a(n):
A. contractionary fiscal policy. B. expansionary fiscal policy. C. low-interest-rate policy. D. neutral fiscal policy.
In 2012, the so-called Tax Freedom Day in the U.S. occurred in:
A. February B. April C. August D. June