If a fiscal policy change is going to exert a stabilizing impact on the economy, it must
a. add demand stimulus during a slowdown but restraint during an economic boom.
b. exert an expansionary impact during all phases of the business cycle.
c. restrain aggregate demand during all phases of the business cycle.
d. keep the government's budget in balance.
A
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If the British pound (£) appreciates by 10% against the dollar:
a. both the US importers from Britain and US exporters to Britain will be helped by the appreciating pound. b. the US exporters will find it harder to sell to foreign customers in Britain. c. the US importer of British goods will tend to find that their cost of goods rises, hurting its bottom line. d. both US importers of British goods and exporters to Britain will be unaffected by changes in foreign exchange rates. e. all of the above.
Recall the scenario from the text: The city of Logan Square needs $40 million for a network of streetlights. There are 20,000 residents in the Logan Square neighborhood, meaning the cost for each resident is $2,000 . Psychiatrist Denise Miller refuses to donate $2,000 towards the project. This is an example of the problems encountered with
a. consumer goods b. capital goods c. rival goods d. public goods e. private goods
Of the collection of supply and demand diagrams in Figure 2.2, which one shows the result of a decrease in the price of a substitute for a good?
A. Figure 1 B. Figure 2 C. Figure 3 D. Figure 4
Which of the following also occurs as the production possibilities curve shifts outward?
A. GDP per capita remains constant. B. The unemployment rate rises. C. Long-run aggregate supply increases. D. Output decrease.