Contractionary fiscal policies used to reduce the deficit in the 1990s did not hurt the economy because fiscal and monetary policies were well coordinated at that time.
Answer the following statement true (T) or false (F)
True
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Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher B. expansionary; higher; potential C. recessionary; higher; potential D. recessionary; lower; lower
Use the following graph to answer the next question.
All else held constant, a leftward shift of the supply curve would ________.
A. increase the equilibrium quantity of euros B. cause a shortage of euros C. appreciate the dollar D. appreciate the euro
Import standards on specific countries usually address issues affecting:
A. domestic consumers. B. domestic producers. C. foreign production practices. D. how goods and services flow from one nation to another.
The cross elasticity between two substitutes is always positive
Indicate whether the statement is true or false