Three candidates for political office disagree over the benefits of enlarging the federal budget deficit
Candidate C says the stimulation package is needed to increase employment and real GDP; Candidate D says it will only cause higher prices; and Candidate F says it will have no effect on either real GDP or the price level. How do the three candidates differ with respect to the condition of the economy and the effects of fiscal policy?
A) Candidate C thinks the simple Keynesian model is applicable, while D thinks the expansionary policy will fully crowd out private investment. F believes the economy is experiencing a recessionary ga
D
You might also like to view...
Marylou, whose utility of wealth curve is shown in the figure above, faces two options. Option A yields her $200 for sure. Option B has a 0.4 probability of yielding $100 and a 0.6 probability of yielding $300. Marylou
A) picks option A. B) picks option B. C) is indifferent between option A and option B. D) needs more information to make a choice.
According to the saving and investment equation, if net foreign investment rises by $60 million,
A) domestic investment will rise by $60 million. B) private saving will fall by $60 million. C) national saving will fall by $60 million. D) national saving will increase by $60 million.
A pricing strategy that requires consumers pay an up-front fee plus an additional fee for each unit of product purchased is a
A) tying contract. B) two-part tariff. C) form of perfect price discrimination. D) none of these.
The primary international reserve asset in most countries is:
a. silver. b. gold. c. the euro. d. the U.S. dollar. e. the Japanese yen.