If the economy is in a recession, and the government raises taxes in an effort to balance the budget, the Keynesian model indicates the likely effect will be to
a. counteract the recession.
b. prolong the recession and increase its severity.
c. end the recession sooner.
d. increase the level of real GDP.
B
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One of the strongest arguments against active stabilization policy is
A. that recognition lags make timely intervention very difficult. B. the economy corrects itself very slowly. C. the inability of economic theory to suggest appropriate policy. D. the difficulty of obtaining agreement on monetary policy.
Explain the process by which the banking system creates money
What will be an ideal response?
The supply of stock
A) comes from new issues. B) comes from current shareholders. C) comes from new shares and current stockholders. D) comes from new shares, current stockholders, and the Federal Reserve.
Sometimes workers earn higher wages through chance
a. True b. False Indicate whether the statement is true or false