Assume the economy is at full employment and that investment spending declines dramatically. If the goal is to restore full employment, government fiscal policy should be directed toward:
A. an equality of tax receipts and government expenditures.
B. an excess of tax receipts over government expenditures.
C. an excess of government expenditures over tax receipts.
D. a reduction of subsidies and transfer payments and an increase in tax rates.
C. an excess of government expenditures over tax receipts.
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The above figure shows the reaction functions for two pizza shops in a small isolated town. Collusion would result in
A) each firm producing 25 pizzas. B) each firm producing 40 pizzas. C) the firms splitting the production of 100 making 50 pizzas each. D) firm A monopolizing the market by selling 50 pizzas.
If an individual receives in-kind transfers from the government in the form of food stamps, public housing, and so on, his money income is
A) less than his total income. B) greater than his total income. C) the same as his total income. D) equal to his in-kind income plus his wages.
Which of the following statements about the "separate but equal" provision of Plessy v. Ferguson is MOST accurate?
a. resulted in African-American schools that were comparable to white schools. b. resulted in African-American schools that were preferable to white schools in the South. c. did not seriously hamper the labor market experience of African-Americans. d. led to the creation of African-American schools that were systematically under funded.
Trace through the Keynesian cause-and-effect sequence. A decrease in the money supply will cause the interest rate to
a. fall, boosting investment and shifting the AD curve to the right, leading to an increase in real GDP b. fall, boosting investment and shifting the AD curve to the right, leading to a decrease in real GDP c. rise, cutting investment and shifting the AD curve to the right, leading to an increase in real GDP d. rise, boosting investment and shifting the AD curve to the right, leading to an increase in real GDP e. rise, cutting investment and shifting the AD curve to the left, leading to a decrease in real GDP