If a government were to find that it cannot raise taxes any further, and that it cannot borrow any further from financial markets, the government:
A. can increase spending by having the central banks purchase its bonds.
B. can decrease the amount of money in circulation.
C. cannot increase its spending any further.
D. is in default.
Answer: A
You might also like to view...
Which of the following inputs is most likely to be "fixed" in the short run?
A) Labor. B) Capital. C) Energy. D) Raw Material.
Economic growth caused by increased employment creates a trade-off between income and
a. present-day living standards b. research and development expenditures c. investment in physical capital d. future living standards e. leisure time
When individuals and businesses are permitted to trade freely over a larger market area,
a. wages will decline to the level of the poorest country in the region. b. the monopoly power of business firms will increase. c. they will be able to produce a larger output and consume a more diverse bundle of goods. d. businesses will be able to earn higher profits, but the income levels of individuals will decline.
A monopolist is able to choose whatever price that it wishes and is only constrained by its greed
a. True b. False Indicate whether the statement is true or false