Procyclical policy:
What will be an ideal response?
fiscal policy in which taxes are lowered and expenditure is raised when the economy is strong, and the opposite
is done when the economy is weak
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Looking at historical evidence for the United States and other countries, which of the following are TRUE?
I. There is a correlation between the growth rate of the quantity theory of money and the growth rate of real GDP. II. There is a correlation between the growth rate of the quantity theory of money and the inflation rate. A) Only I is true. B) Only II is true. C) Both I and II are true. D) Neither I or II is true.
When effects are irreversible, it may be sensible to treat their possible causes even if they cannot be identified with certainty
Indicate whether the statement is true or false
Developments in the computer software industry have made it extremely easy for firms to keep their books, conduct their own audits, and fill out the various tax forms. If accountants are an input in the accounting services industry, what will likely happen in the market for accountants? Is there a difference between the short run and the long run?
According to the short-run aggregate supply curve, firms are most likely to respond to an increase in aggregate demand by raising:
A. neither production nor prices. B. prices. C. both production and prices. D. production.