Fiscal policy involves discretionary changes in
A. the rate of growth of the money supply.
B. interest rates.
C. lump-sum taxes.
D. exchange rates.
Answer: C
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Economists use the term shocks to mean
A) unexpected government actions that affect the economy. B) typically unpredictable forces that have major impacts on the economy. C) sudden rises in oil prices. D) the business cycle.
Which of the following is evidence of an inflationary gap?
a. very long lines at employment agencies b. very short waiting times for product delivery c. very low sales figures d. very long search times for people looking for jobs e. very low unemployment rates
Which of the following is a characteristic of a contestable market?
a. long-run economic profit b. many firms that are small relative to the market c. high costs for entry and exit d. minimum-cost production methods
It is possible for a country to have domestic investment that exceeds national saving
a. True b. False Indicate whether the statement is true or false