John Maynard Keynes argued that if many households decide at the same time to increase saving and reduce spending
A) the economy will benefit in the short run and benefit by an even greater amount in the long run.
B) this will have a major negative impact on the economy in both the short run and in the long run.
C) this may benefit the economy in the long run, but could be counterproductive in the short run.
D) this may benefit the economy in the short run, but not in the long run.
C
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From an economist's perspective, why are public restrooms often dirtier than restrooms in your home?
A. Restrooms in your house are easier to clean. B. Property rights give you an incentive to clean your restrooms. C. There are incentives like a salary for janitors to clean the public restrooms. D. More people use the public restrooms.
If people feel optimistic about the future of the economy ________
A) autonomous consumption might increase B) autonomous investment might increase C) it might shift the IS curve to the right D) all of the above E) none of the above
Which of the following activities will generate a negative externality?
a. A beekeeper keeping bees for honey b. Inoculations for communicable diseases c. Research and development activities of a firm d. A chemical factory set up in a residential area e. Improvement in education facilities
Assume that the economy is in a recession and there is a budget deficit. A strict balanced-budget amendment that would require the federal government to balance its budget during a recession would be:
A. expansionary and worsen the effects of the recession. B. expansionary and counter the effects of the recession. C. contractionary and worsen the effects of the recession. D. contractionary and counter the effects of the recession.