With the economy booming, the government starts to worry about the increasing rate of inflation, and decides to cut its spending on highway maintenance and defer it to sometime in the future. This is an example of:
A. an automatic stabilizer.
B. discretionary fiscal policy.
C. expansionary fiscal policy.
D. None of these is true.
B. discretionary fiscal policy.
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What are law-making lags? What effect do they have on the use of discretionary fiscal policy?
What will be an ideal response?
A cartel is a group of firms
A) acting separately to limit output, lower price, and decrease economic profit. B) acting together to limit output, raise price, and increase economic profit. C) legally fixing prices. D) acting together to erect barriers to entry. E) that compete primarily with each other rather than the other firms in the market.
Which of the following factors is the most significant in determining the pattern of international trade?
a. absolute advantage b. diplomatic expertise c. comparative advantage d. overpowering military strength e. a country's size relative to another country's
Assume there are two people in a society. Person A is willing to pay $140 to have one unit of a public good produced and Person B is willing to pay $160 to have one unit of a public good produced and $140 to have two units produced. As a result, society would be willing to pay a price of ________ of this public good.
A. $200 for 3 units B. $200 for 1 unit C. $160 for 5 units D. $300 for 1 unit