Since the U.S. economy expanded rapidly from 1992 to 2000, it must be true that
A. fiscal contraction overwhelmed monetary expansion.
B. monetary expansion overwhelmed fiscal contraction.
C. monetary expansion exactly offset fiscal contraction.
D. monetary contraction overwhelmed fiscal expansion.
Answer: B
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Answer the next question based on information in the following table.ProductPercentage Change in IncomePercentage Change in Quantity DemandedW?1?1X+6+3Y?1+1Z+4+8Which product would be an inferior good?
A. product W B. product X C. product Y D. product Z
When the tax rates imposed on the rich are high, a reduction in these rates
a. will always lead to a reduction in the tax revenue collected from the rich. b. will not affect the tax revenue collected from the rich. c. will increase the reported incomes of the rich and it may also lead to an increase in tax revenue collected from them. d. will decrease the reported incomes of the rich, and thereby reduce the tax revenue collected from them.
Consider two individuals — Marquis and Serena — each of whom would like to wear sweaters and eat tasty food. The gains from trade between Marquis and Serena are most obvious in which of the following cases?
a. Marquis is very good at knitting sweaters and at cooking tasty food, but Serena's skills in both of these activities are very poor. b. Marquis and Serena both are very good at cooking tasty food, but neither has the necessary skills to knit a sweater. c. Marquis's cooking and knitting skills are very poor, and Serena's cooking and knitting skills are also very poor. d. Marquis's skills are such that he can produce only sweaters, and Serena's skills are such that she can produce only tasty food.
What is a multilateral exchange rate?
a. It is an exchange rate that is measured by using a number of different techniques. b. It is an exchange rate that calculates the overall movement of the rate against more than just one other currency. c. It is an exchange rate that is measured once every 10 years. d. It is a rate that is set by the IMF for many different nations.