What prompted the large increase in tax rates in 1932 in the midst of an economic recession?
a. concern that inflation would rise due to increases in real output and aggregate demand
b. expansionary fiscal policy designed to stimulate aggregate demand
c. the Keynesian view that taxes should be increased during a recession
d. the view that the federal government should maintain a balanced budget
D
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A worker is hired in a
A) goods and services market. B) government market. C) product market. D) factor market.
To stabilize real GDP, the Fed must increase the money supply in response to a
a. positive demand shock b. low level of unemployment c. sudden upsurge in inflation d. rise in the interest rate e. negative demand shock
If the marginal cost of producing the next unit of output exceeds the average total cost, then:
A. the average total cost curve is increasing. B. the marginal cost curve is at its minimum. C. the average total cost curve is decreasing. D. the average total cost curve is at its minimum.
A single-plant firm trying to select the rate of output consistent with an overall plant size that yields the minimum efficient scale will choose a rate of output for which
A) the short-run marginal cost curve crosses the short-run average total cost curve at that rate of output. B) the long-run marginal cost curve crosses the long-run average fixed cost curve at that rate of output. C) long-run average total cost is lowest at that rate of output. D) total fixed cots are minimized at that rate of output.