Built-in stability refers to the fact that net tax revenues vary inversely with the level of GDP.
Answer the following statement true (T) or false (F)
False
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Suppose the production of a good results in negative externalities. If society produces the output consistent with the intersection of the demand curve and the marginal private cost curve, then
A. the socially optimal level of output will be produced. B. society will incur a net social cost. C. society will want more output produced, and producers will be willing to satisfy this desire at a price that society deems acceptable. D. all of the above E. There is not enough information to answer this question.
Someone who loses his job at a truck factory because the demand for trucks has fallen and the demand for cars has risen, is structurally unemployed
a. True b. False Indicate whether the statement is true or false
An insurance company that writes automobile policies tries to separate safe drivers from risky drivers by offering policies that feature different deductibles and different premiums. This practice is best described as an example of
a. screening. b. behavioral economics. c. monitoring. d. signaling.
A fiscal policy action to close an expansionary gap is to:
A. decrease taxes. B. increase the marginal propensity to consume. C. increase transfer payments. D. decrease government purchases.