Inflation initiated by increases in wages or other resource prices is labeled:
A. demand-pull inflation.
B. demand-push inflation.
C. cost-push inflation.
D. cost-pull inflation.
C. cost-push inflation.
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Everything else held constant, a decrease in government spending will cause the IS curve to shift to the ________ and aggregate demand will ________
A) right; increase B) right; decrease C) left; increase D) left; decrease
Professor Cowen suggests that, in practice, fiscal policy is not ideal because:
A. voters typically expect the federal government to balance its budget even during a recession. B. elected officials have an incentive to raise taxes even when the appropriate fiscal policy response is to cut taxes. C. the federal government continually has budget deficits rather than having surpluses when the economy is healthy. D. political infighting makes it unlikely that Congress will ever approve a budget, let alone approve fiscal policy actions.
Recall the Application about a South African consumer lender that offered different interest rates in loan offers via mass mailings to answer the following question(s).According to the Application, the number of men who accepted a particular loan offer from the mass mailings ________ when the offer letter included the picture of a ________.
A. increased; man rather than the picture of a woman B. increased; woman rather than the picture of a man C. decreased; either a man or a woman D. was unaffected; either a man or a woman
Which of the following price indices comes closest to measuring the cost of living of the typical household?
A) GDP deflator B) consumer price index C) producer price index D) household price index