An expansionary fiscal policy increases a government budget deficit or reduces a government budget surplus, increases borrowing by the Treasury, which will sell more bonds.
a. true
b. false
Ans: a. true
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If a firm hires workers up to the point where the value of their marginal product equals their wage, then the firm is
a. minimizing labor costs. b. maximizing profit. c. maximizing the MP of labor. d. minimizing average costs.
There has been a decrease in investment. As a result, real GDP will ________ in the short run, and ________ in the long run
A) decrease; decrease further B) increase; decrease to its initial value C) increase; increase further D) decrease; increase to its initial level
Suppose scientists provide evidence that people who drink energy drinks are more likely to have a heart attack than people who do not drink energy drinks. We would expect to see
a. no change in the demand for energy drinks. b. a decrease in the demand for energy drinks. c. an increase in the demand for energy drinks. d. a decrease in the supply of energy drinks.
All Giffen goods are
a. inferior goods, and all inferior goods are Giffen goods. b. inferior goods, but not all inferior goods are Giffen goods. c. normal goods, but not all normal goods are Giffen goods. d. normal goods, and all normal goods are Giffen goods.