Changes in taxes or spending levels that stimulate aggregate demand without the passage of any new laws are called _____
a. expenditure multipliers
b. discretionary monetary policies
c. discretionary fiscal policies
d. automatic stabilizers
d
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Refer to Figure 11.2. Suppose that Ca = 40, MPC = 0.8, I = 10. Equilibrium income is
A) 40. B) 50. C) 250. D) 400.
In the 1970s, the main economic problem was
A. stagflation. B. huge budget surpluses. C. a slow growing money supply. D. an economy that was expanding too rapidly.
Which statement best describes a command economy?
A. The production of goods and services is determined primarily by markets, but the allocation of goods and services is determined primarily by government. B. The production and allocation of goods and services is determined primarily through markets. C. The production and allocation of goods and services is determined primarily through government. D. The production of goods and services is determined primarily by government, but the allocation of goods and services is determined primarily by markets.
In a monopolistically competitive market if the additional revenue generated from advertising equals the additional cost of advertising, the firm should
A. advertise less to decrease costs. B. maintain its current amount of advertising. C. advertise more to lower marginal costs. D. advertise more to increase sales.