Fiscal policy works principally through shifts of the aggregate demand curve.
Answer the following statement true (T) or false (F)
True
The federal government's tax and spending powers give it a great deal of influence over aggregate demand. The government can alter aggregate demand by purchasing more or fewer goods and services, raising or lowering taxes, and changing the level of income transfers.
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When a monopolist engages in perfect price discrimination,
A) the marginal revenue curve lies below the demand curve. B) the demand curve and the marginal revenue curve are identical. C) marginal cost becomes zero. D) the marginal revenue curve becomes horizontal.
A survey made by Starc Motors reveals that the attrition rate for specialized workers is very high. In order to reduce attrition and increase productivity, the CEO of Starc Motors decides to pay the workers more than what market conditions dictate. The policy adopted by this company is based on the _____
a. efficiency wage theory b. model of option pricing c. insider-outsider model d. relative wage coordination argument
According to Rosenberg (2004), the U.S. economy between the Civil War and World War II was relatively poor in which of its productive resources?
(a) Land (b) Labor (c) Capital (d) Entrepreneurial talent
Which of the following is an example of a durable good?
a. a cowboy b. a cherry pie c. a newspaper d. a hand-held calculator e. a pencil