Which of the following will most likely cause a shift in the consumption function?
a. a change in consumer confidence
b. a change in national output
c. a change in real GDP
d. a change in disposable income
a
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A price ceiling in the market for fuel oil that is below the equilibrium price will
A) lead to the quantity supplied of fuel oil exceeding the quantity demanded. B) lead to the quantity demanded of fuel oil exceeding the quantity supplied. C) decrease the demand for fuel oil. D) increase the supply of fuel oil. E) have no effect in the market for fuel oil.
The most effective means of stimulating the economy during a recession is for the federal government to
a. increase spending and hold taxes. b. hold government spending and decrease taxes. c. decrease government spending and hold taxes. d. decrease government spending and raise taxes.
Suppose a business firm dumps its used car batteries into a river.
A. The company's actions constitute an external cost. B. The company's actions constitute an external benefit. C. The company's actions would be an example of the market system efficiently allocating resources. D. The company's actions damage no one but itself.
In the United States during the 1960s, government spending dramatically increased to fight the Vietnam War, which resulted in:
A. demand-pull inflation. B. cost-push inflation. C. a disinflationary recession. D. stagflation.