Macroeconomic stabilization involves
(a) reduction of inflation.
(b) reduction of government budget deficits.
(c) reduction of trade deficits.
(d) all of the above.
(e) none of the above.
D
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In the above figure, if the market produces the efficient amount of purses then producer surplus equals
A) triangle bcd. B) triangle adc. C) rectangle bcde. D) trapezoid adec.
If there is a sudden increase in government spending, which of the following should the Fed do if it wants to keep output unchanged?
a. Do nothing, since the self-correcting mechanism will adjust the economy b. Sell bonds in the open market c. Wait, since output usually does not change when government spending increases d. Decrease the required reserve ratio e. Buy bonds in the open market
If the national debt is strictly an internal debt, then
a. the amount of the debt places a burden on the generation that repays the debt b. the amount of taxes used to pay the interest on the debt equals the interest payments to the bond holders, and there is no national debt burden c. the amount of taxes used to pay the interest on the debt equals the interest payments to the bond holders creating a national interest-created debt burden d. the amount of the debt places a burden on the generation when the debt is incurred because it reduces the amount of consumption e. the amount of taxes used to pay the debt is paid by future generations, which shifts the burden of the debt from the present to the future generation
Since the mid-1970s our merchandise balance of trade has been ________ and our services balance of trade has been _______.
Fill in the blank(s) with the appropriate word(s).