Discretionary fiscal policy refers to:
A. changes in taxes and transfers that occur as GDP changes.
B. the authority that the president has to change personal income tax rates.
C. any change in government spending or taxes that destabilizes the economy.
D. changes in taxes and government expenditures made by Congress to stabilize the economy.
Answer: D
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If the economy were producing at point E and moved to point B the opportunity cost in terms of lost production of outboard motors would be
A. 16 units of outboard motors.
B. 14 units of outboard motors.
C. 12 units of outboard motors.
D. 10 units of outboard motors.
The quantity of loanable funds supplied increases if the ________, all other things remaining the same, because the ________
A) real interest rate falls; real interest rate is the opportunity cost of consumption B) real interest rate rises; real interest rate is the opportunity cost of saving C) real interest rate falls; real interest rate is the opportunity cost of saving D) real interest rate rises; cost of living is determined by the real interest rate E) real interest rate rises; real interest rate is the opportunity cost of consumption
For a restaurant, all the following are fixed costs, except
a. Space rental b. Advertising c. Raw material cost d. All of the above-they are all variable costs
After a $5 million ad campaign, Coca-Cola measured its effectiveness by calculating the cross elasticity of demand between Coke and Pepsi. A successful campaign would be indicated if the cross elasticity went from
a. 0.9 to 0.5. b. 0.9 to 1.5. c. ?0.5 to ?0.2. d. ?0.9 to ?1.5.