Historically, the U.S. government seems to have ________
A) run budget surpluses as often as budget deficits
B) generally spent less than what it collected in taxes each year
C) had difficulty running budget surpluses
D) not needed to borrow to finance wars
E) none of the above
C
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Market equilibrium
i. can never occur because there are always people who want a good but cannot afford it. ii. occurs at the intersection of the supply and demand curves. iii. is the point where the price equals the quantity. A) ii only B) iii only C) ii and iii D) i only E) i and ii
Both Keynesians and real business cycle proponents believe that tax cuts increase output
a. and both agree it does this through increasing aggregate demand. b. but Keynesians believe it does this through increasing aggregate demand and not aggregate supply. c. but Keynesians believe it does this through increasing aggregate supply and not aggregate demand. d. and both agree it does this through increasing aggregate supply.
A firm is producing 10,000 units of output in two plants, A and B, and each plant is producing 5,000 units of output. The marginal cost in plant A is $10 and the marginal cost in B is $6. To reduce the cost of producing 10,000 units the firm should
A. produce less in A and more in B. B. produce more in A and less in B. C. do nothing since the output in each plant is equal. D. produce it all in B because B is the lower cost plant.
It is difficult for cyclically unemployed individuals to find jobs because:
A. they do not meet the qualifications required for the available jobs. B. the economy is in a recession. C. they quit their last job and employers view them with suspicion. D. they have not looked long enough to find a job.