The U.S. government need never default on its debt because
a. it can easily nationalize banks, who own all the debt, and then owe it to itself.
b. it can raise the funds it needs to repay by taxation, and it can print money to repay.
c. it owes the debt to itself, and it can always ignore a demand for repayment.
d. it can simply reduce spending enough to generate funds to repay its debt.
b
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Policy-oriented economists seek to develop theories to
a. explain how things work so policies can be formulated. b. describe what happened in a particular time period in history. c. describe current economic events. d. find correlations between events. e. change people's values and ethics.
Based on the graph showing marginal cost pricing versus average cost pricing, if the government makes the natural monopolist use marginal cost pricing, the monopoly will ______ money because PMC is ______ than ATC.
a. make; less
b. make; more
c. lose; more
d. lose; less
An increase in the real interest rate will:
a. Shift the consumption schedule upward b. Decrease the amount of investment spending c. Shift the investment demand curve to the right d. Shift the investment demand curve to the left b. Decrease the amount of investment spending
In the 1980s and most of the 1990s, the U.S. government budget balance was ________ and the U.S. current account balance was ________.
A. negative; positive B. negative; negative C. positive; positive D. positive; negative