The economic impact of ________ during recessionary periods is to decrease taxes.
A. negative demand shocks
B. automatic stabilizers
C. increasing the reserve rate
D. recognition lags
Answer: B
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If policymakers use a pollution tax to control pollution, the tax per unit of pollution should be set
A) equal to the marginal private cost of production at the economically efficient level of pollution. B) equal to the amount of the deadweight loss created in the absence of a pollution tax. C) at a level low enough so that producers can pass along a portion of the additional cost onto consumers without significantly reducing demand for the product. D) equal to the marginal external cost at the economically efficient level of pollution.
Which of the following is the correct expression for short-run aggregate supply in the new classical view?
A) YP = Y + a(P - ) B) Y = YP + a(P - ) C) YP = Y + a(P + ) D) Y = YP + a(P + )
Expansionary fiscal policy
What will be an ideal response?
Banks can hold deposits at the Federal Reserve. Balances in these accounts can be used by banks to meet their reserve requirements, but the Fed pays no interest on these deposits
a. True b. False Indicate whether the statement is true or false