Refer to Table 27-2. Consider the hypothetical information in the table above for potential real GDP, real GDP, and the price level in 2016 and in 2017 if Congress and the president do not use fiscal policy
If Congress and the president want to keep real GDP at its potential level in 2017, they should
A) decrease the discount rate. B) decrease government purchases.
C) conduct expansionary fiscal policy. D) buy Treasury securities.
B
You might also like to view...
The condition of fully flexible wages and prices was assumed by
A) no economists. B) the classical economists. C) modern economists. D) the Keynesian economists.
Why has Chinese exchange rate policy been controversial?
What will be an ideal response?
Ceteris paribus, if Americans decide they want to drive more German-made cars, this causes the ________ German currency to ________.
A. demand for; decrease B. supply of; increase C. supply of; decrease D. demand for; increase
Which of the following best exemplifies a firm with a zero economic profit?
a. A hair salon that is making a small profit after expenses, but whose owners feel they could make more money by closing the business and getting different jobs. b. A bike shop that makes enough of a profit that its owners feel it is worth the time and money they put into the business. c. A cleaning service that is just getting started and does not yet have enough customers to cover the firm’s expenses. d. A popular restaurant with revenues that greatly exceed expenses and whose owners are planning to expand into a chain.