When the economy heads into a recession, automatic stabilizers cause
A. taxes and government spending to rise.
B. the government budget deficit to increase.
C. taxes and government spending to fall.
D. national income to increase.
B. the government budget deficit to increase.
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Public saving is positive when:
A. the government's budget is balanced. B. there is a government budget surplus. C. after-tax income of households and businesses is less than consumption expenditures. D. after-tax income of households and businesses is greater than consumption expenditures.
Refer to Figure 24-3. Suppose the economy is at point A. If government spending increases in the economy, where will the eventual long-run equilibrium be?
A) A B) B C) C D) D
According to the contract theory of wages, firms and workers agree on a contract that fixes
a. money wages. b. real wages. c. money wages and employment. d. real wages and employment.
The U.S. economy faced negative inflation: a. after World War II
b. during the dotcom bubble. c. during the Great Depression of the 1930s. d. after the real estate bubble burst.