If output is falling, a procyclical fiscal policy will result in:
A. lower taxes and/or decreased government spending.
B. higher taxes and/or decreased government spending.
C. higher taxes and/or increased government spending.
D. lower taxes and/or increased government spending.
Answer: B
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Suppose that Firestone Tires buys raw rubber for $5,000 and then uses this to make tires it sells for $20,000 . As a result, GDP has risen by:
a. $20,000 b. $5,000 c. $15,000 d. $25,000
If some firms internalize their external costs by being a cleaner and more "environmentally friendly" producers than other firms that do not, then which of the following offers the best and most complete description of this situation?
a. The environmentally friendly firm will be operating at a higher marginal and average cost than those firms that shift some costs to society in the form of external costs. b. In a long-run competitive equilibrium in which consumers do not distinguish between environmentally friendly and standard producers, the environmentally producers will receive negative economic profits and be forced to change or exit. c. Without regulations requiring firms to internalize their external costs, producers can only afford to be environmentally friendly if consumers reward them with a price premium. d. None of the above is correct.
A start-up company sets goals and standards for themselves based on the performance of their competitors. This is an example of
a. groupthink b. mbwa c. swot d. benchmarking
All of the following will shift the short-run aggregate supply (SRAS) curve EXCEPT
A. a change in the price of labor. B. technological progress. C. a change in the price level. D. a change in the prices of raw materials.