Policy makers who believe that the costs of unemployment are very high will tend to favor which of the following during a recessionary gap?
a. moderate fiscal stimulus, no monetary stimulus
b. fiscal and monetary tightness
c. moderate monetary stimulus, fiscal tightness
d. strong fiscal and monetary stimulus
d
You might also like to view...
On the Laffer curve, an increase in tax rates causes tax revenue to increase if the starting point is
A. to the right of the top. B. exactly at the top. C. to the left of the top. D. to the farthest point to the right.
In the equation Y = (1/1 – b + v)(a + I + G + X ? u), the term (1/1 – b + v) is referred to as the
a. level of autonomous expenditures. b. autonomous expenditure multiplier. c. balanced budget multiplier. d. tax multiplier.
Generally, the opportunity cost and the money cost of a good
a. are identical only if the good sells in a free market. b. are different. c. matter only to the purchaser of the good. d. are not reflected in its price.
When the market basket is tracked over time the goods within the basket:
A. reflect the typical consumer each year, but prices are held constant, so it captures if we are consuming more or less as an economy. B. remain the same, so only changing prices are captured. C. remain the same, but some prices are held constant on items that are important to consumers. D. reflect the typical consumer each year, so it captures how consumers are affected each year.