Recall the Application the Joint Committee on Taxation and how Congress accounts for the dynamic effects of its policies to answer the following questions.According to the Application, the Trump Tax cuts would have increased the deficit by ________ billion, without taking into account the dynamic effects.
A. $1456
B. $1591
C. $286
D. $641
Answer: A
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The economy pictured in the figure has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; A B. recessionary; C C. recessionary; B D. expansionary; A
If the fraction of the economy's nominal GDP held by the public in the form of money is 20 percent, income velocity in the economy is
A) 5. B) 80 percent. C) 0.20. D) 20.
Rational expectations theorists believe that governments publicizing their economic goals ______.
a. is necessary to educate the people, so they behave as intended b. leads people to act in their own interests and undercut the government’s intended outcomes c. prevents people from being able to anticipate the future of the economy d. is the most important step in being able to meet the government’s goals
Which of the following is an advantage of fixing exchange rates?
A. making the prices of foreign goods more flexible in the domestic market B. making residents more mobile across countries C. limiting foreign exchange risk D. eliminating trade deficits