In an aggregate expenditures diagram, equal increases in government spending and in lump- sum taxes will:
A. shift the aggregate expenditures line downward.
B. shift the aggregate expenditures line upward.
C. leave the aggregate expenditures line unchanged.
D. reduce the equilibrium GDP.
B. shift the aggregate expenditures line upward.
You might also like to view...
The United States appears at times to have a totally schizophrenic attitude toward protectionism
The United States was the country that proposed the establishment of the World Trade Organization as early as the late 1940s, and was also the only industrialized country that refused to ratify this at that time. The United States has consistently argued on the side of multinational free trade in GATT Rounds, and yet maintains many protectionist laws such as those which reserve oil shipments from Alaska to U.S. flag carriers. How can you explain this apparent lack of national consistency on this issue?
According to the Gallup World Values Survey, 40 percent of those living in the poorest quartile of countries would like to:
A. get more education. B. receive more aid. C. trade freely. D. emigrate.
Which of the following shocks have caused most of the recessions since 1950?
a. Both c and e b. Increased government spending c. Oil price increases d. The beginning of a war e. Changes in Federal Reserve Policy
A regulatory policy under which the government picks the point on the demand curve at which price equals average cost is known as:
A. average-cost pricing. B. marginal-cost pricing. C. average-revenue pricing. D. competitive pricing.