Use the following table to answer the next question.Money SupplyInterest RateGross Investment$200 billion0.2%$1 trillion$250 billion0.2%$1 trillion$300 billion0.2%$1 trillionWhich limitation for monetary policy is illustrated by the table?
A. crowding out
B. pessimistic business expectations
C. policy lags
D. the liquidity trap
Answer: D
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In the years immediately following the passage of the American Recovery and Reinvestment Act, interest rates ________, and the prices of goods and services ________.
A. remained high; barely changed B. fell dramatically; rose at higher-than-normal rates C. rose sharply; fell sharply D. remained low; rose at lower-than-normal rates
If black markets help people meet their needs, they will tend to ________ created by the restrictive government policies
A) increase the absolute advantage B) reduce the deadweight losses C) reduce the cooperative surpluses D) increase the tax revenues
Governments have to rely on taxes for financing because
A. they cannot borrow unlimited amounts. B. they usually spend all of the gold reserves. C. they are not allowed to sell bonds. D. it is easier to collect taxes than to print money.
The lowest wage that may be legally paid for an hour's work is called the
A. just wage. B. minimum wage. C. living wage. D. maximum wage.