If an economy were experiencing a high rate of unemployment as the result of insufficient aggregate demand, a Keynesian economist would favor:
A. a reduction in taxes coupled with a reduction in government expenditures of equal size.
B. an increase in government expenditures coupled with an increase in taxes of equal size.
C. a reduction in taxes, without any offsetting reduction in government expenditures.
D. maintenance of a balanced budget.
Answer: C
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Which of the following describe the United States economy in 2008 and and the start of 2009?
A) Real GDP reached a peak. B) The economy was in a recession. C) The economy was in an expansion. D) Real GDP per person increased. E) None of the above answers is correct.
The IS curve will shift to the right if:
a. the government deficit decreases. b. consumer confidence decreases. c. the MPC decreases. d. taxes decrease. e. the money supply increases.
Which of the following is considered a classic example of an externality?
a. pollution b. monopoly c. sunlight d. inflation
If the average variable cost of the fifth hat is $30, then the total variable cost of five hats is
A) $6. B) $150. C) $1800. D) indeterminate from this information.