Crowding out suggests that debt promotes overconsumption
Indicate whether the statement is true or false
F
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Suppose the MPC is 0.85 . If government purchases increase by $10 billion and net taxes fall by $10 billion, equilibrium output will
a. fall by $10 billion b. increase by $10 billion c. increase by $20 billion d. increase by $66.7 billion e. increase by $123.3 billion
By requiring that policyholders pay a deductible on a claim, insurers guard against
a. symmetrical information b. adverse selection c. natural selection d. moral hazard e. the winner's curse
The Effect of State and Local Government Spending on GDP
What will be an ideal response?
Suppose both supply and demand decrease. What effect will this have on price?
A. It will remain the same. B. It will fall. C. It will rise. D. It may rise or fall.