Fiscal policy is a change in either government purchases or the money supply designed to change total spending in the economy, thereby influencing the levels of employment and output
a. True
b. False
B
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Half of all your potential customers would pay $10 for your product but the other half would only pay $8 . You cannot tell them apart. Your marginal costs are $4 . If you set the price at $8, the expected profit is:
a. $3 b. $4 c. $5 d. $6
Leugers Custom Cabinetmakers is currently operating at a profit while producing four custom cabinets per week. At that output level, marginal cost exceeds marginal revenue. In order to maximize profit, Leugers should
a. decrease output b. increase output c. leave output at four cabinets per week d. either increase or decrease output, depending on its level of fixed costs e. either increase or decrease output, depending on its level of variable costs
The process of innovation is the act of
a. discovering a new production process. b. discovering a new product. c. basic scientific research. d. adopting a new product to a market demand.
If there is a political business cycle and the Federal Reserve supports the incumbent, then we should expect that prior to elections
a. interest rates and output would rise. b. interest rates would rise and output would fall. c. interest rates would fall and output would rise. d. interest rates and output would fall.