Which of the following is true about fiscal policy?
What will be an ideal response?
Proper timing of changes in discretionary fiscal policy is both crucially important and difficult to achieve.
You might also like to view...
Suppose we claim that the rapid economic growth in Barylia can be attributed to the culture hypothesis. Which of the following statements is most likely to be concluded from this claim?
A) Barylia must have large stocks of productive natural resources. B) Institutions in Barylia must have been inclusive. C) Barylia must have a huge stock of physical capital. D) The local people in Barylia must be socially inclined to work hard.
Suppose Bob leaves his $50,000-a-year job as a financial advisor to P.E.T.S. and starts his own business selling pet-care products. In the first year, his accounting profit is $70,000. Based on this level of success, Bob should:
a. return to his old job because his economic profit is negative. b. return to his old job because his economic profit is smaller than his accounting profit. c. return to his old job because his economic profit is less than his old salary. d. stay with his new firm because his economic profit is positive. e. stay with his new firm because accounting profit is positive.
If banks face a problem in loan markets when bad credit risks are the ones most likely to seek bank loans, it is described as
A) moral hazard. B) moral suasion. C) adverse selection. D) fraud.
Refer to the above table. For which prices is demand inelastic?
A. in a range of prices below $6.00 B. in a range of prices above $9.00 C. in a range of prices above $6.00 D. in a range of prices between $5 and $1