When it comes to environmental policy,
a. choices are influenced by the costs and benefits that decision makers expect.
b. values are subjective, as in other areas of the economy.
c. policy choices often have unintended secondary effects.
d. all of the above are true.
D
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The Ricardo-Barro effect says that
A) government budget deficits have no crowding out effect because taxpayers increase their savings to match the quantity of loanable funds demanded by the government. B) government budget deficits crowd out private investment and thereby lower the real interest rate. C) government budget deficits resulting from an increase in government expenditure have no effect on investment but government deficits resulting from a decrease in taxes crowd out investment. D) government budget deficits cause households to save more in anticipation of higher taxes, which causes higher real interest rates.
An innovation cycle could be caused by
a. a decreasing capital stock b. a sharp increase in national income c. a climatic change d. a sharp increase in the pace of technological change e. a decrease in the demand for housing
The effectiveness of expansionary fiscal policy is directly proportional to the level of _______ in the economy.
A. efficiency B. inefficiency C. inflation D. employment
Suppose you sell surfboards for a living, and you expect the price of surfboards to increase at the same rate as inflation; you adjust your prices accordingly. If this does not occur, then it must be true that:
A. the inflation rate is different from what was expected. B. the relative price of surfboards is changing. C. the price of surfboards is changing at a rate that is different from what was expected. D. both the price of surfboards and the inflation rate are different from what was expected.