Supply-siders argue that:
a. reductions in government spending cut infrastructure investment which hurts private sector investment.
b. increases in government spending increase infrastructure investment which helps private sector investment.
c. increases in government spending causes private sector investment to fall because the government pushes up interest rates.
d. reductions in government spending cause private sector investment to fall because the government pushes up interest rates by borrowing.
e. increases in government spending causes consumption spending to fall because the government purchases push up interest rates.
c
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Suppose there are three power-generating plants, each of which has access to 5 different production processes. The table below summarizes the cost of each production process and the corresponding number of tons of smoke emitted each. Process(smoke/day) A(4 tons/day) B(3 tons/day) C(2 tons/day) D(1 ton/day) E(0 tons/day) Cost to Firm X ($/day) $500$514$530$555$585 Cost to Firm Y ($/day) $400$420$445$480 $520Cost to Firm z ($/day) $300$325$360$400 $550It would cost Firm X ________ to reduce emissions by one ton if it currently emits 3 tons, and ________ to reduce emissions by one ton if it currently emits 2 tons.
A. $14; $25 B. $14; $16 C. $30; $55 D. $16; $25
Do deficits lead to inflation?
What will be an ideal response?
A surplus occurs whenever
a. current price is greater than equilibrium price b. quantity supplied exceeds quantity demanded at the equilibrium price c. quantity demanded is greater than quantity supplied d. the problem of scarcity of a good is solved e. some buyers would be willing and able to pay even more for it than they have to at equilibrium
Imagine that you are a member of the Board of Governors of the Federal Reserve. If the economy is experiencing rapid inflation, what actions might you advocate? Why?