During the early years of the Reagan administration, some of the presidential advisors argued that tax cuts could reduce inflation because they would give people an incentive to produce more. Critics of this argument believed that tax cuts would increase inflation, not reduce it. The critics were arguing that tax cuts move the:
A. long-run aggregate supply curve to the right with little change in aggregate demand.
B. aggregate demand curve to the right with little change in long-run aggregate supply.
C. aggregate demand curve to the left with little change in long-run aggregate supply.
D. long-run aggregate supply curve to the left with little change in aggregate demand.
Answer: B
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When you toss your spare quarters into a jar so you can use them later at the laundromat, you are using money in its function as a
A) medium of exchange. B) unit of account. C) store of value. D) record keeping device.
Economists began carefully calculating GDP
a. simply because the data was available b. to determine the contribution of specific firms to the economy c. as a result of the problems during the Great Depression d. to make sure that firms were being productive e. to gain insight into the causes of unemployment
Most bank deposits in the United States are insured by the Federal Deposit Insurance Corporation (FDIC).
Answer the following statement true (T) or false (F)
A bowed production possibilities curve is consistent with
A) a decreasing opportunity cost. B) a technologically inefficient society. C) the overutilization of productive resources. D) highly specialized resources.