When the economy is producing its potential output, an increase in government spending must necessarily reduce some component of private spending. This phenomenon is called
A) the multiplier effect. B) entitlement spending.
C) fiscal policy. D) crowding out.
D
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Explain why selling output at a price below that at which marginal revenue equals marginal cost (MR = MC) might serve to deter entry of a potential competitor
What will be an ideal response?
Which of the following is not a property of a typical indifference curve?
a. downward sloping b. bowed away from the origin c. does not intersect another indifference curve d. a higher one is preferred to a lower one
According to the original Phillips curve, the cost of reducing the unemployment rate in the short run is a
A) fall in Real GDP. B) fall in nominal GDP. C) lower rate of price inflation. D) higher rate of wage inflation.
To increase U.S. energy independence, prices must be lowered on gasoline and electricity.
Answer the following statement true (T) or false (F)