Which of the following is an objective of government taxation?
A) Reducing the demand for money in the economy
B) Increasing the supply of money in the economy
C) Redistribution of funds
D) Reducing the growth rate of the economy
C
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If the MPC = 0.9, the multiplier would be
A) 0.1. B) 2. C) 9. D) 10.
Suppose the government spending multiplier is 2. The federal government cuts spending by $40 billion. What is the change in GDP if the price level is not held constant?
A) a decrease of more than $80 billion B) an increase of less than $80 billion C) an increase equal to $80 billion D) an increase of greater than $80 billion E) a decrease of less than $80 billion
A recessionary gap is the amount that autonomous aggregate expenditures must rise to cause the equilibrium level of real GDP to shift to the full-employment level of real GDP
a. True b. False Indicate whether the statement is true or false
The introduction of an overnight delivery service that guarantees the delivery of packages anywhere in the world overnight would increase:
A. the unemployment rate. B. the share of population employed. C. the labor force participation rate. D. average labor productivity.