Two drawbacks in using fiscal policy as a stabilization tool are that fiscal policy can affect ________ as well as aggregate demand and that fiscal policy is ________.
A. consumption; offset by automatic stabilizers
B. potential output; not flexible enough
C. potential output; offset by automatic stabilizers
D. consumption; too flexible
Answer: B
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A monopolist faces an average total cost of $10 when it produces 400 units of its product. If it sells the 400 units at $6 per unit, ________
A) the monopolist makes a profit of $600 B) the monopolist makes a loss of $600 C) the monopolist makes a profit of $1,600 D) the monopolist makes a loss of $1,600
The total cost schedule shows the relationship between different amounts of inputs and the resulting level of output
Indicate whether the statement is true or false
Which of the following is not an automatic stabilizer:
a. Business profits taxes. b. Welfare payments. c. Unemployment compensation. d. All of the above are examples of automatic stabilizers.
Suppose Jon Stewart of the "Daily Show" makes an annual income of $1,000,000. If he quit his television job and went into producing he could make $400,000 per year. Jon Stewart's opportunity cost as a producer is
A) $1,400,000. B) 1,000,000. C) $400,000. D) $600,000.