When the economy is at the full employment level of real GDP, expansionary fiscal policy will not increase the economy's total output in the long run
a. True
b. False
Indicate whether the statement is true or false
True
You might also like to view...
Which of the following would not be included in the government consumption expenditures and gross investment (G) category of GDP?
a. The payments made to Social Security recipients. b. The expenditures made to repair a highway. c. The spending for professors at state universities. d. The purchase of new china for White House functions.
If the economy experiences an unplanned inventory accumulation at the full employment level of GDP, then the economy is in a(n)
a. inflationary gap. b. hyperinflation. c. recessionary gap. d. full employment gap.
Which of the following is true of the market equilibrium in the presence of negative externalities? a. It is the intersection of the social cost curve and the demand curve
b. It is the intersection of the private cost curve and the demand curve. c. Net social welfare is maximized at the equilibrium. d. Market output is less than the socially optimal output at the equilibrium.
A politician may be considered an entrepreneur in the sense that
a. he is always open to bribery. b. identical personal characteristics are necessary for success in politics and in business. c. the successful politician discovers and offers voters political goods when voter demand is strong for him. d. like the businessman, the politician selfishly attempts to gain at the expense of his customers.