Figure 11-1
In Figure 11-1, the slope of the expenditures schedule is .75 and the government wishes to achieve full employment. It should
a.
cut spending by 1,000.
b.
increase spending by 1,000.
c.
cut taxes by 1,000.
d.
increase spending by 250.
e.
cut taxes by 250.
d
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The Commodity Credit Corporation (CCC) instituted several policies to improve the welfare of farmers. Which of the following best describes the programs' effects?
a. The CCC price supports mandated a one-price policy on all agricultural goods. b. The CCC made loans to farmers, using the farmers' future crops as collateral with recourse. c. The CCC price supports inefficiently allocated resources, which decreased welfare. d. If the commodity price increased, according to the free market, then the CCC would command and collect "excess" profits, i.e., revenues in excess of the one-price policy, for use as loanable funds.
If households view a tax cut as temporary, then the tax cut
a. has no effect on aggregate demand. b. has more of an effect on aggregate demand than if households view it as permanent. c. has the same effect as when households view the cut as permanent. d. has less of an effect on aggregate demand than if households view it as permanent.
The supply of money increases when the public buys government securities from commercial banks.
Answer the following statement true (T) or false (F)
To the extent that oligopolies ________, there is the promise of new and exciting products.
A. differentiate their products B. advertise C. produce homogeneous products D. Both A and B are correct.