Which of the following is the appropriate fiscal policy during a recession?
A. A budget surplus
B. A budget deficit
C. A balanced budget
D. No change to the budget
B. A budget deficit
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The average investor must weigh the benefits of liquidity against
A) the high taxes generally levied on liquid assets. B) the lower returns on liquid assets. C) the high transactions costs involved in disposing of liquid assets. D) the greater variability in the nominal returns on liquid assets.
If Bella eats one piece of pie, she gains a utility of 10. If she continues, a second piece yields a marginal utility of 8, a third will yield a marginal utility of 2, and a fourth piece of pie will yield a marginal utility of 2. We can say:
A. Bella's marginal utility is not diminishing. B. Bella's total utility will decrease if she eats the third piece of pie. C. Bella's total utility will be maximized if she eats three pieces. D. Bella's total utility decreases after the first piece of pie.
Both sugar and fructose can be used in the production of candy. If the price of sugar increases,
a. the demand for sugar increases b. sugar becomes relatively more expensive than fructose only if the price of fructose falls c. sugar becomes relatively more expensive than fructose, other things constant d. the price of fructose immediately increases e. the price of fructose immediately decreases
In the Keynesian economic model, _____________ aggregate demand brings unemployment and too much brings inflation.
a. too much b. stable c. too little d. dynamic