Rank the following state and local government expenditure categories from largest to smallest
a. education, health, highways
b. education, highways, income security
c. highways, education, public order and safety
d. public order and safety, highways, health
a
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Assume that an economy's real GDP multiplier is 2 and that this economy is in equilibrium at $500 billion. If the government wants to move this economy to full-employment at $600 billion, while maintaining a balanced budget, it must choose which of the following options?
a. Increase government spending and taxes by $100 billion b. Decrease government spending and taxes by $100 billion c. Increase government spending and taxes by $200 billion d. Decrease government spending and taxes by $200 billion
Phrases such as "unbreakable bottle," "non-shrink," "extra spicy," and "nonstick surface" are generally used in advertisements for products sold in perfectly competitive markets
a. True b. False Indicate whether the statement is true or false
Suppose the government has a $180 billion budget deficit. If the government creates $95 billion of new money to finance this deficit and finances the rest by borrowing, the amount borrowed from the public will be
A) $85 billion. B) $95 billion. C) $180 billion. D) $275 billion.
Increased government borrowing stimulates private borrowing because of its effect on interest rates
a. True b. False Indicate whether the statement is true or false