Using Figure 1 above, if the aggregate demand curve shifts from AD2 to AD1 the result in the long run would be:
A. P4 and Y1.
B. P4 and Y2.
C. P5 and Y1.
D. P5 and Y2.
Answer: D
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The measurement system used by the U.S. government to estimate national income is
A. the GDP deflator. B. the sum of consumption plus investment expenditures. C. the sum of financial transactions, transfer payments and secondhand goods. D. national income accounting.
The United States payroll tax is regressive at top income levels.
Answer the following statement true (T) or false (F)
Economists agree that the cause of the slow economic growth during the 1970s was the tight fiscal policy.
Answer the following statement true (T) or false (F)
Which of the following is an unintended consequence of austerity policies?
A. Large budget deficits B. Reduction in unemployment C. Hyperinflation D. Reduction in taxes