In the twentieth century, fluctuations in real GDP were
a. less severe during the last 50 years than was true during the first half of the century.
b. virtually eliminated as the result of the countercyclical application of fiscal policy.
c. more severe during the last 50 years than was true during the first half of the century.
d. primarily the result of a fiscal policy that has persistently balanced the federal budget.
A
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If there is no Ricardo-Barro effect, an increase in the government budget surplus
A) increases the supply of loanable funds. B) decreases private saving. C) increases private saving. D) decreases the supply of loanable funds. E) has no effect on the demand for loanable funds, the supply of loanable funds, or the real interest rate.
What is an indifference curve?
A) It is a curve that shows the combinations of consumption bundles that give the consumer the same utility. B) It is a curve that shows the total utility and the marginal utility derived from consuming a bundle of goods. C) It is a curve that ranks a consumer's preference for various consumption bundles. D) It is a curve that shows the tradeoff a consumer faces among different combinations of consumption bundles.
Using a discount rate above the market interest rate to evaluate projects will
a. bias a decision toward going ahead with the project b. correct for distortions in capital markets c. have no impact on project evaluation d. bias a decision toward rejecting a project e. none of the above
Which of the following is an example of government failure?
A. Merit goods. B. Too much regulation resulting in wasted resources. C. Public goods. D. Externalities.