Ricardian equivalence is the proposition that
A) government expenditure should only be financed by taxes.
B) it does not matter whether government expenditure is financed by creating new money or issuing debt.
C) government expenditure should only be financed by issuing new debt.
D) it does not matter whether government expenditure is financed by taxes or debt.
D
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The self-correcting tendency of the economy means that falling inflation eventually eliminates:
A. exogenous spending. B. recessionary gaps. C. expansionary gaps. D. unemployment.
Money is "created" when
A. a depositor deposits money at the bank. B. people use money to pay for stuff they buy from one another. C. someone lends money to a friend or a family member. D. a bank grants a loan to a customer.
Gary consumes 10,000 units of electricity when his income is $500. When his income increases to $1,000, his consumption of electricity increases to 18,000 units. What is Gary's income elasticity of demand for electricity?
A) 0.5 B) 0.8 C) 1.8 D) 2
For a single-price monopolist, price is ________ marginal revenue
A) less than B) greater than C) equal to D) less than or equal to but never more than