Suppose the economy is at full employment with a high inflation rate. Which combination of government policies is most likely to reduce the inflation rate?
A. Selling government securities in the open market and increasing government spending.
B. Buying government securities in the open market and decreasing taxes.
C. Selling government securities in the open market and decreasing government spending.
D. Buying government securities in the open market and increasing taxes.
Answer: C
You might also like to view...
If the government liberalizes immigration policies, the demand for labor will ________, the real wage will ________, and the quantity of labor hired will ________
A) remain the same; decrease; increase B) increase; decrease; remain the same C) remain the same; decrease; decrease D) remain the same; increase; decrease
Pencils are produced in the market economy
A) only because people need pencils. B) only because pencil production is centrally planned, from the growing of the trees and mining of the graphite to the final stages of pencil assembly. C) even though the final assemblers of pencils have no idea how to produce the paint, graphite, wood, rubber, and metal ferrules. D) by government decree.
Examine the benefits and cons of employee pay in the form of salary and commission, or incentive pay, in terms of the moral hazard problem
Please provide the best answer for the statement.
Suppose demand decreases, but there is no change in supply. As the market reaches its new equilibrium:
A. excess supply will lead the price to fall. B. excess demand will lead the price to fall. C. excess supply will lead the price to rise. D. excess demand will lead the price to rise.