If President Obama wanted to decrease aggregate demand, which of the following would he tend to favor?
a. An increase in government spending, because it will increase the size of the public sector.
b. A decrease in government spending, because it keeps the public sector small.
c. An increase in transfer payments, because it has a larger multiplier than tax changes.
d. An increase in taxes, because it would not make the public sector smaller.
b
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What is understood by infant industry arguments against free trade?
What will be an ideal response?
A more complex view of the incentives facing a bureaucrat _____
a. shows that bureaucrats might prefer to maximize their discretionary budget over their total budget b. shows that bureaucrats might prefer to always act in the public interest, if they believe in their bureau's mission. c. shows that the incentives facing a bureaucrat are simple and never conflict with one another. d. shows that the bureaucrats may about increasing their own income but their power and prestige
The inflationary gap is the
a. inflation rate that will occur from excess aggregate demand. b. budget deficit that caused the inflation to occur. c. distance between the equilibrium level of output and the full employment level of output. d. gap between expected and actual inflation.
Full-employment income is the same as the potential GDP of the economy.
Answer the following statement true (T) or false (F)