Fiscal expansion
A) stimulates aggregate demand and causes output to decline.
B) decreases aggregate demand and causes output to decline.
C) stimulates aggregate demand and causes output to rise.
D) decreases aggregate demand and causes output to rise.
E) decreases government expenditures.
C
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Which is the true statement?
A) A society does not need an authoritative central plan to generate order and cooperation. B) A society will fall into social chaos without an authoritative central plan. C) An economic system can last only if guided by a central economic plan. D) Both B and C are true.
During the early 1930s, the Fed was reluctant to rescue nonsolvent banks out of fear of encouraging:
A) moral hazard B) adverse selection C) bank run D) sovereign debt crisis
An exclusion contract
A) is a form of entry deferral. B) gives a firm the right to be the exclusive provider of a good in a particular market. C) may not always be profitable for the incumbent. D) All of the above.
If the demand for corn is elastic, then:
a. there are not many substitutes for the consumption of corn. b. the price elasticity of demand for corn is less than -1. c. a decrease in price will reduce total revenue for corn producers. d. an increase in price will increase total revenue for corn producers. e. consumers will continue buying the same quantity even if price increases.