The major advantage of automatic stabilizers is that they
a. guarantee the federal budget will be balanced in a relatively short amount of time.
b. institute countercyclical fiscal policy without the delays associated with legislative action.
c. automatically produce surpluses during recessions and deficits during expansions.
d. require discretionary actions on the part of Congress before they exert an impact on output and employment.
B
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Under a k-percent rule, if the economy goes into expansion, the Fed would
A) increase the quantity of money. B) raise the federal funds rate. C) lower tax rates to keep revenue constant. D) lower the federal funds rate. E) None of the above answers is correct.
Scarcity refers to the situation in which
A) unlimited wants exceed limited resources. B) a country's population is larger than its resource base. C) a nation's poverty level increases faster than its population. D) unlimited resources exceed limited wants.
If the stores could co-operate, what is the new Nash equilibrium?
a. Megastore $95 and Superstore $80 b. Megastore $305 and Superstore $55 c. Megastore $65 and Superstore $285 d. Megastore $165 and Superstore $115
According to the graph above, which of the following will occur if a legal price ceiling is imposed at price X?
What will be an ideal response?