The Kennedy tax cut of 1964 was
a. successful in stimulating the economy.
b. designed to shift the aggregate demand curve to the right.
c. designed to shift the aggregate supply curve to the right.
d. All of the above are correct.
d
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Consider two economies: A and B. In economy A, the work culture is such that people do not mind working for 12 hours a day. On the contrary, in economy B, people work for a maximum of 6 hours in a day. If the culture hypothesis holds, then:
A) the growth rate in both economies are likely to fluctuate randomly. B) economy A is likely to grow faster than economy B. C) economy B is likely to grow faster than economy A. D) both economies are likely to grow at the same rate.
If you wanted to measure changes in fiscal policy intentions, you should use the
a. capital budget. b. actual deficit. c. inflation-accounted deficit. d. structural deficit.
Exhibit 4-2 Supply and demand curves
In Exhibit 4-2, which of the following might cause a shift from S1 to S2?
A. A decrease in input prices. B. A decrease in consumer prices. C. An increase in input prices. D. An increase in consumer income.
In the short run, a trade deficit allows more consumption, but in the long run, a trade deficit is a problem because the:
A. domestic currency will appreciate. B. country eventually will consume more and produce less. C. country eventually has to produce more than it consumes in order to pay foreigners their profits. D. country eventually will sell all its financial assets to foreigners.