Which of the following is not an example of crowding out?
A) Government purchases rise, the budget deficit rises, the federal government's demand for loanable funds rises, the interest rate rises, and investment falls.
B) Government spends more on X, prompting individuals to spend less on X.
C) Taxes decline, the budget deficit rises, the federal government's demand for loanable funds rises, the interest rate rises, the demand rises for U.S. dollars, the dollar appreciates, and net exports decline.
D) Business firms spend more on X, prompting households to spend less on Y.
E) none of the above
D
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How much is it?
Classical economists would cite all of the following as reasons why the government cannot smooth out the business cycle except that
A) only productivity shocks can cause real fluctuations in the business cycle. B) the government has imperfect knowledge of the economy. C) political constraints on policy actions prevent the government from carrying out effective policies. D) time lags between the onset of a recession and the implementation of effective countermeasures make anti-recessionary macroeconomic policies impractical.
A community has five voters who are interested in only one issue: the government's spending on local parks. If Andre would like the government to spend $12,000 on parks, Brandon prefers $7,000, Charlene prefers $4,000, Dennis prefers $2,000, and Ernie prefers $0, how much spending would a politician seeking to win the election select when running against one opponent?
a. $2,000 b. $4,000 c. $7,000 d. $12,000
In the balance of payments accounts, there will be a surplus in the financial account of a country if:?
What will be an ideal response?