In response to the recession of 2008-2009, the United States
a. increased government spending as a share of the economy and enlarged the size of the budget deficit.
b. reduced government spending as a share of the economy and shifted the budget toward a surplus.
c. increased government spending as a share of the economy and shifted the budget toward a surplus.
d. reduced government spending as a share of the economy and enlarged the size of the budget deficit.
A
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Use the following graph to answer the next question.
Suppose an economy's full employment output is at the level Qf shown on the graph. Further, suppose the economy's current aggregate demand is represented by AD1. If the government swiftly implements a stimulus program that immediately shifts the economy's aggregate demand to AD2, the aggregate demand in the short-to-medium term would be most closely represented by
A. AD0. B. AD1. C. AD2. D. AD3.
A reduction in wage is most likely to:
A) increase worker productivity. B) increase quantity of labor supplied. C) decrease quantity demanded of labor. D) lower worker productivity.
The 2002 federal tax cuts _____
a. were based on efficiency considerations b. were based on equity considerations c. were based on budgetary considerations d. did not have a clear motivation
Protection provided to the infant industries is rarely withdrawn because:
a. the costs of withdrawing protection outweigh the benefits. b. the industries begin to experience diseconomies of scale. c. it leads to a loss of government revenue. d. the industries produce goods which are close substitutes of the imported goods. e. the larger and more successful the industry becomes, the more political power it wields.