The higher the marginal propensity to consume, the
A) smaller will be the simple multiplier.
B) more insulated will be consumption spending from exogenous shocks to the economy.
C) less effective will be any given monetary or fiscal policy.
D) more unstable the economy will be.
D
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A more complex view of the incentives facing a bureaucrat _____
a. shows that bureaucrats might prefer to maximize their discretionary budget over their total budget b. shows that bureaucrats might prefer to always act in the public interest, if they believe in their bureau's mission. c. shows that the incentives facing a bureaucrat are simple and never conflict with one another. d. shows that the bureaucrats may about increasing their own income but their power and prestige
Shutting down a firm's operation and quitting production is equivalent to exiting the industry.
Answer the following statement true (T) or false (F)
The U.S. economy in the 1960s was dominated by a massively expansionary ________ policy that ended up ________
A) monetary, overstimulating the economy B) monetary, being impotent in ending the long stagnation of that decade C) fiscal, overstimulating the economy D) fiscal, being impotent in ending the long stagnation of that decade
Sales of intermediate goods and services (goods and services purchased for further reprocessing and resale) are excluded from GDP to avoid the problem of double counting, which is counting an item's value more than once
Indicate whether the statement is true or false