Without deficit targeting, a negative demand shock results in a decrease in income, but with deficit targeting, a negative demand shock results in an increase in income.
Answer the following statement true (T) or false (F)
False
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Suppose the President asks you to write him a letter suggesting ways the government might help the economy achieve permanently higher rates of economic growth
Based on your understanding of growth theory and growth accounting, what would you suggest?
In reference to funding industrywide advertising, if the majority of managers free ride, which of the following is likely to occur?
A) The industrywide marginal benefit of advertising will fall below its marginal cost. B) The industry will maximize its joint profit. C) The industrywide marginal benefit of advertising will equal its marginal cost. D) The industrywide marginal benefit of advertising will exceed its marginal cost.
Assume the marginal propensity to consume (MPC) is 0.80 and the government increases taxes by $100 billion. The aggregate demand curve will shift to the:
a. left by $80 billion. b. right by $200 billion. c. right by $400 billion. d. left by $400 billion.
The Big Mac Index perfectly explains the relative size of economies.
a. true b. false