Fiscal policy is enacted through changes in:
A. taxation and government spending.
B. interest rates.
C. unemployment and inflation.
D. the supply of money.
Answer: A
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Government expenditures on goods and services include
i. the New York City Library's purchase of new books. ii. Washington D.C.'s purchase of gas for its city buses. iii. California's payment of wages to prison guards. A) i and ii B) i and iii C) i, ii and iii D) i only E) ii and iii
When the government provides a public good such as a highway,
a. society benefits without necessarily involving a reallocation of resources b. only highway users benefit and that occurs without necessarily involving a reallocation of resources c. it uses resources, but the benefits are so great there is no resource reallocation effect d. it necessarily reallocates resources away from the production of other goods e. it has the same resource allocation effect on the economy as a government transfer payment
An ad valorem tax causes the supply curve to:
A. shift to the right. B. become steeper. C. become flatter. D. shift to the left.
According to the textbook, monetary policymaking is most accurately described as:
A. both an art and a science. B. a science due to detailed models used. C. an art since human judgments are necessary. D. superior to other policies, since it is conducted by economists.