To close an inflationary gap through fiscal policy, the government should
A. reduce taxes in order to stimulate investment, and thus increase aggregate supply.
B. increase government spending and taxes in order to both increase aggregate demand and aggregate supply.
C. decrease government spending in order to increase aggregate supply.
D. decrease government spending in order to reduce aggregate demand.
Answer: D
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Compared to prices charged by Uber, traditional taxi companies charge government-regulated prices. These government-regulated prices ________ in the market for shared rides
A) decrease producer surplus B) decrease consumer surplus C) increase consumer surplus D) decrease deadweight loss
Creating a market that was previously "missing":
A. redistributes surplus from buyer to seller. B. creates more total surplus. C. redistributes surplus from seller to buyer. D. redistributes surplus from one market to the one that was previously missing.
Assume that business investment spending rises, and the increase is funded by greater borrowing in the capital markets. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the GDP Price Index and net nonreserve international borrowing/lending balance in the context of the Three-Sector-Model? a. The GDP Price Index rises and net
nonreserve international borrowing/lending balance becomes more positive (or less negative). b. The GDP Price Index rises and net nonreserve international borrowing/lending balance becomes more negative (or less positive). c. The GDP Price Index falls and net nonreserve international borrowing/lending balance becomes more positive (or less negative). d. The GDP Price Index and net nonreserve international borrowing/lending balance remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
A hedonic wage function could be applied to which of the following job characteristics?
A. the degree to which the area surrounding the job location is safe B. the degree to which a job involves monotonous work C. the probability of being injured on the job D. the degree to which a job involves strenuous work E. All of the above can be represented with a hedonic wage function.