The argument that econometric policy evaluation is likely to be misleading if policymakers assume stable economic relationships is known as
A) the monetarist revolution.
B) the Lucas critique.
C) public choice theory.
D) new Keynesian theory.
B
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A cartel is a group of firms that
A) produce differentiated products. B) produce products that are complements. C) agree to restrict output to boost their profit. D) agree to boost output to boost their profit.
The saving function shows the relationship between planned real saving and
A) real wealth. B) real disposable income. C) the average propensity to save. D) the marginal propensity to save.
Suppose you read in the French daily Le Monde that saving in France in 2003 was less than the intended investment French businesses had hoped to make. You would conclude that in 2003, the French economy was
a. in equilibrium, and no change occurred in its national income b. not in equilibrium, and its national income fell c. in equilibrium, and its national income fell d. not in equilibrium, and its national income rose e. in equilibrium, and its national income rose
Mr. Jones pays his employees by the hour. He believes they purposely work slowly to maximize their personal satisfaction. What can he do to provide them with a stronger incentive to work efficiently?