An appropriate fiscal policy response when aggregate demand is growing at a slower rate than aggregate supply is to cut taxes
Indicate whether the statement is true or false
TRUE
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Refer to Scenario 1 . If you start the course in such a way that each exam score is worse than your previous average what should happen to your average score? What would happen to your average if the next exam score was larger than your previous exam
score? Explain.
If an increase in the price of a product from $1 to $2 per unit leads to a decrease in the quantity demanded from 100 to 80 units, then the value of price elasticity of demand is
a. -1/3 b. -2 1/3 c. -1/4 d. -3 e. -2/3
Even if the economy has considerable excess capacity, new government spending that creates new jobs involves opportunity costs because
A. goods other than those purchased by government could have been produced and consumed. B. unemployed workers are unwilling to surrender leisure time to take paid jobs. C. excess capacity implies that the capital stock exceeds equilibrium. D. government employment is inefficient relative to jobs in the private sector. E. expansionary monetary policy stimulates employment without growth of national debt.
Which of the following would an economist classify as capital?
A. a corporate bond B. a $50 bill C. a guitar used by a musician D. a post office employee