Expansionary fiscal policy involves increasing government purchases or increasing taxes
Indicate whether the statement is true or false
FALSE
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What does the term "increasing marginal opportunity cost" mean? How are increasing marginal opportunity costs represented on a bowed out production possibilities frontier?
What will be an ideal response?
Ultimate solutions to the problems of unsustainable debt must take into account the incentives for lenders to make loans
Indicate whether the statement is true or false
An increase in the effective tax rate on capital would cause the IS curve to
A) shift up and to the right. B) shift down and to the left. C) remain unchanged. D) remain unchanged if taxes are fully deductible from income; otherwise, shift up and to the right.
A decrease in price causes:
A. a quantity effect, which is an increase in revenue that results from selling fewer units of the good. B. a price effect, which is an increase in revenue that results from receiving a lower price for each unit sold. C. both a price effect and quantity effect. D. a decrease in quantity demanded.