When economists refer to the economy's self-correcting mechanism, they are referring to the fact that the
a. economy will react automatically to a recessionary gap through inflation.
b. economy will react automatically to an inflationary gap through deflation.
c. economy will react automatically to an inflationary gap through inflation.
d. simple multiplier is greater than the complex multiplier.
c
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In the long run, profit-maximizing monopolists facing a downward-sloping demand curve
A. may earn profits greater than their opportunity costs of capital. B. do not produce every possible unit of output for which marginal utility is greater than or equal to marginal cost. C. may or may not have lower costs than perfectly competitive firms in the same industry. D. All of these responses are correct.
If a company pays a dividend of $5 to be received one year from now, dividends are expected to grow at a rate of 8 percent per year for the indefinite future, and the interest rate is 14 percent,
the price of the company's stock should be ________ per share. A) $8.00 B) $83.33 C) $227.27 D) $610.00
Which group of economists argues that the stock market crash of 1929 significantly reduced wealth, causing consumption to fall and resulting in a significant downturn in residential construction and investments?
(a) Classical economists. (b) Keynesian economists. (c) Monetarists. (d) Austrians.
Long lines and gasoline shortages during the 1970's can be attributed completely to the decision by OPEC to raise crude oil prices
a. True b. False Indicate whether the statement is true or false