According to the classical model, if the government lowers its budget deficit, which of the following will occur?
a. The interest rate will rise, and consumption, investment and output will all decrease.
b. The interest rate will fall, consumption and investment will increase, but output will not change.
c. The interest rate will rise, and consumption, investment and output will all increase.
d. The interest rate will fall, and consumption, investment and output will all increase.
e. The interest rate will fall, consumption will not change, but investment and output will both increase.
B
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The table above gives the U.S. CPI for six years. Calculate the inflation rates between 1997 to 1998, 1998 to 1999, 1999 to 2000, 2000 to 2001, and 2001 to 2002
What will be an ideal response?
Autonomous determinants of consumption expenditures are dependent on the level of current disposable income
a. True b. False Indicate whether the statement is true or false
Suppose that the government taxes income in the following fashion: 30 percent of the first $20,000 . 50 percent of the next $30,000 . and 60 percent of all income over $50,000 . Ted earns $40,000 . and Robin earns $60,000 . Which of the following statements is correct?
a. Ted's marginal tax rate is 60 percent, and his average tax rate is 50 percent. b. Ted's marginal tax rate is 50 percent, and his average tax rate is 40 percent. c. Robin's marginal tax rate is 50 percent, and her average tax rate is 45 percent. d. Robin's marginal tax rate is 60 percent, and her average tax rate is 40 percent.
Were it not for our trade surplus of ___________ the U.S. balance of trade would be even larger.
Fill in the blank(s) with the appropriate word(s).