An example of fiscal policy is
A. a reduction in investment spending by the private sector.
B. a cost-of-living adjustment in Social Security payments to the elderly.
C. an increase in government spending.
D. an increase in autonomous spending by consumers.
Answer: C
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A. Everything else remaining unchanged, what is likely to happen to the credit demand curve of an economy if:
i. businesses in the economy see scope for growth and are planning to expand production in the future? ii. households are pessimistic about future incomes? iii. the government is planning to borrow money from financial institutions for investment in infrastructures? b. Everything else remaining unchanged, what is likely to happen to the credit supply curve of an economy if firms tend to hold on to retained earnings instead of paying dividends?
Consumption smoothing refers to ________
A) the impact of future income on current consumption and of current income on future consumption B) the constancy of consumption over time C) the impact of current consumption on future income and of future consumption on current income D) the tendency of consumers to adopt similar spending habits
Refer to the above figure. At Point B, the actual unemployment rate
A) will decrease over time. B) is negative. C) tends to be higher than the natural unemployment rate. D) tends to be lower than the natural unemployment rate.
Price discrimination refers to
a. the actions of a single-price monopolist to determine the best price for its output b. selling the same product to different customers at different prices as a result of different production costs c. government regulation of public utility prices d. selling the same product to different customers at different prices for reasons unrelated to production costs e. charging a price just above average total cost in order to drive competing firms from the market