If the government undertakes expansionary fiscal policy, it:
A. should force people to change their spending patterns.
B. expects aggregate demand to decrease.
C. expects aggregate demand to increase.
D. could increase income taxes.
Answer: C
You might also like to view...
If the market price is $4 and a perfectly competitive firm is producing 3,200 units and the marginal cost to produce the 3,200th unit is $3.88, which of the following is true?
A) The difference between marginal revenue and marginal cost (MR - MC) for the 3,200th unit is negative. B) The firm should increase production to maximize profit. C) The firm is maximizing profit. D) The firm should decrease production to maximize profit.
Suppose a country experiencing hyperinflation for a long period of time chooses to use a historically stable currency, like the U.S. dollar, to increase investor and consumer confidence and provide a stable and secure economic and investment climate. This is an example of _____
a. globalization b. privatization c. dollarization d. standardization
If the current market federal funds rate is in the target rate range and the demand for reserves decreases, the likely response in the federal funds market will be:
A. the market federal funds rate will decrease. B. the market federal funds rate will increase. C. the market federal funds rate will equal the target rate. D. nothing; the reserve supply is so high that the market federal funds rate will be unchanged.
Outsourcing is a term increasingly used to refer to the act of:
A. replacing relatively expensive American workers with low-wage workers overseas. B. importing raw materials into the United States from other countries. C. exporting final goods to other countries. D. hiring illegal immigrants.