The self-correcting property of the economy means that output gaps are eventually eliminated by:
A. increasing or decreasing potential output.
B. government policy.
C. decreasing inflation only.
D. increasing or decreasing inflation.
Answer: D
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Which of the following is NOT true about the $3 per pizza tax illustrated in the above figure?
A) It decreases consumer surplus by $90 thousand. B) It decreases producer surplus by $45 thousand. C) It creates a deadweight loss of $135 thousand. D) None of the above because they are all true.
Explain briefly why U.S. Steel prefers to own its mines, enrichment facilities, and ore carriers
If the demand for money decreases, a constant interest rate policy requires the Fed to
a. consult with leaders in the financial markets to see whether it should introduce credit controls b. watch to see whether the investment spending decreases c. move quickly to prevent a recession d. decrease the supply of money e. decrease the interest rate
International trade does all the following except
What will be an ideal response?