What fiscal policy tools are used to shift the aggregate demand curve?
A. Government spending and interest rates
B. Taxes and interest rates
C. Government spending and taxes
D. Taxes and employment rates
C. Government spending and taxes
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When the price of pizzle trees increased by 20 percent last year, consumers ended up spending 10 percent more on the purchase of pizzle trees. This shows that the demand for pizzle trees
A) was elastic. B) was inelastic. C) was unit elastic. D) did not obey the law of demand.
"Even though we can convert them into money, deposits at banks are not money." Is the previous statement correct or not?
What will be an ideal response?
Expressing the U.S. federal budget deficit as a percentage of Gross Domestic Product (GDP)
A) results in inflation-adjusted revenue and expenditure numbers. B) helps us understand the size of the deficit relative to the size of the economy. C) was useful through the 1980s, but is no longer helpful because both the deficit and real Gross Domestic Product (GDP) have grown so large. D) is only useful if the budget deficit is rising at an annual rate of more than 4 percent.
Which of the following would encourage an outward shift of the PPF?
(a) Outward emigration of entrepreneurs; (b) A decrease in demand as the economy slips into recession; (c) The level of capital investment falls; (d) Inward migration of skilled workers.