According to the new Keynesian school of thought, fiscal policy is a completely ineffective tool in combating supply-side shocks
a. True
b. False
Indicate whether the statement is true or false
False
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The economic theory that emphasizes the role of difficulties in coordinating economic affairs as a cause of economic fluctuations is known as
A) investment cycle theory. B) real business cycle theory. C) technology shock theory. D) Keynesian economics.
Suppose that Congress allocates $5 billion to an "energy-efficient appliance rebate" program. It also raises taxes by $5 billion to keep the deficit from growing. If the marginal propensity to consume is 0.8, what is the effect on equilibrium GD
A) GDP does not change. B) GDP increases by $5 billion. C) GDP increases by $25 billion. D) GDP increases by $4 billion.
When there are large federal budget deficits, the trade deficit tends to shrink
a. True b. False Indicate whether the statement is true or false
The equity market is said to be an efficient market because it is difficult for an investor to continually earn above-normal profits
a. True b. False Indicate whether the statement is true or false