Ingrid operates a business that provides optics equipment to the government. She just received a government contract for $2 million. She then hires three new employees and buys a great quantity of supplies from several vendors. Her employees and the vendors earn more money, pay more taxes, spend more money, and save more money. This is an example of ______.
a. automatic stabilization
b. the Laffer curve
c. the multiplier effect
d. contractionary policy
c. the multiplier effect
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A seller who is a price taker charges:
A) above the market price. B) different prices to different buyers. C) the market price. D) below the market price.
Suppose that C = Ca + 0.6y and a shock decreases Ca by $50 billion. Assuming there is no government involvement, by how much will equilibrium GDP decrease?
What will be an ideal response?
Firms are much more likely to provide non-excludable public goods than excludable public goods. ?
Answer the following statement true (T) or false (F)
Ceteris paribus means:
A) allowing all other things to change. B) making value judgments. C) all other things unchanged. D) differentiating between macroeconomics and microeconomics.