Which of the following is a transfer payment?
a) the wages paid to a civil servant
b) the government’s payment to a contractor building a bridge
c) an interest payment on the national debt
d) a Social Security check sent to a retiree
e) the purchase of a subway token
d) a Social Security check sent to a retiree
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A fiscal policy action to close an expansionary gap is to:
A. increase transfer payments. B. decrease government purchases. C. decrease taxes. D. increase the marginal propensity to consume.
Everything else held constant, an appreciation of the domestic currency will cause the IS curve to shift to the ________ and aggregate demand will ________
A) right; increase B) right; decrease C) left; increase D) left; decrease
If credible low-money-growth policies were continually pursued by the Fed, nominal wages and prices would eventually fall as the economic agents would expect lower inflation rates over time
a. True b. False Indicate whether the statement is true or false
What are opportunity costs? How do explicit and implicit costs relate to opportunity costs?