Ceteris paribus, _______ can change without shifting the demand curve for jackets.
a) The price of jackets
b) Taste
c) Income
d) The price of sweaters
Answer: a) The price of jackets
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Classical economists would cite all of the following as reasons why the government cannot smooth out the business cycle except that
A) only productivity shocks can cause real fluctuations in the business cycle. B) the government has imperfect knowledge of the economy. C) political constraints on policy actions prevent the government from carrying out effective policies. D) time lags between the onset of a recession and the implementation of effective countermeasures make anti-recessionary macroeconomic policies impractical.
Explain how firms that each produce as efficiently as they can may not be equally productive
What will be an ideal response?
As long as the debt is internally held, there are no problems associated with the government going into debt
Indicate whether the statement is true or false
Economists often find it worthwhile to make assumptions that do not necessarily describe the real world
a. True b. False Indicate whether the statement is true or false