A budget deficit occurs when government receipts fall short of government spending
a. True
b. False
Indicate whether the statement is true or false
True
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What happens in the short run in the Keynesian model to the exchange rate and net exports in each of the following cases?
(a) The foreign real interest rate falls. (b) Foreign output rises. (c) Foreign demand for domestic goods rises. (d) Domestic output rises. (e) The domestic real interest rate falls.
More cattle are found to have mad cow disease. As a result, consumer confidence in the safety of beef is shaken. What would an economist predict will happen in the beef market?
A. The demand curve will shift to the left. B. absolutely no change in either the quantity demand or the demand for beef C. As consumer preferences move away from beef, there is an upward movement along the beef demand curve. D. The demand curve does not shift but consumers move to a point lower down the curve.
Fiscal policy may not be effective because it takes time for policymakers to realize that a policy change is needed, known as the ________ lag.
A. recognition B. implementation C. impact D. legislative
Which one of the following helps preserve incentives to develop new technologies?
A) patents B) tariffs C) income taxes D) quantity restrictions on imports