In the main chorus of the Keynes-Hayek rap lyrics, Keynes states "I want to steer markets" and Hayek replies, "I want them set free.". These statements are referring to
a. the tendency of Keynesians to favor government intervention and central planning and the tendency of Hayekians to favor free markets.
b. the tendency of Keynesians to favor restrictive fiscal policy and the tendency of Hayekians to favor expansionary fiscal policy.
c. the tendency of Keynesians to favor budget deficits and the tendency of Hayekians to insist on budget surpluses.
d. the tendency of Keynesians to favor fiscal policy and of Heyekians to favor monetary policy.
A
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Growth accounting, popularized by Robert Solow, attempts to attribute a change in aggregate output
A) to its most important single cause. B) separately between changes in government policy and changes in total factor productivity. C) separately between changes in total factor productivity and changes in the supplies of factors of production. D) separately between changes in the supplies of factors of production and changes in government policy.
Appendix: In regression analysis, the existence of a high degree of intercorrelation among some or all of the explanatory variables in the regression equation constitutes:
a. autocorrelation b. a simultaneous equation relationship c. nonlinearities d. heteroscedasticity e. multicollinearity
The accompanying graph shows the long-run supply and demand curves in a purely competitive market. We know that when this market reaches equilibrium, the marginal
a) cost equals marginal benefit. b) benefit exceeds marginal cost. c) cost exceeds marginal benefit. d) cost equals zero.
Demand curves for pure public goods satisfy the law of demand.
A. True B. False C. Uncertain