In 1981, the Reagan administration employed a policy that included tax ____ while at the same time the Federal Reserve’s strategy was to combat ____.
A. cuts; unemployment
B. cuts; inflation
C. hikes; unemployment
D. hikes; inflation
Answer: B
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A feature of perfect competition is
A) use of non-price competition by firms. B) mutual interdependence among firms. C) unique products. D) standardized products.
Refer to Figure 7.2. Curve A must be MPL and Curve B must be APL because:
A. the two curves intersect at the maximum of Curve A.
B. everywhere that Curve A is positively-sloped, Curve B is positively-sloped as well, and everywhere that Curve A is negatively-sloped, Curve B is negatively-sloped as well.
C. when Curve A lies above Curve B, Curve B is rising, and when Curve A lies below Curve B, Curve B is falling.
D. when Curve B lies above Curve A, Curve A is rising, and when Curve B lies below Curve A, Curve A is falling.
The welfare loss associated with the outcome in a colluding oligopoly is:
A. smaller than that of a perfectly competitive outcome. B. the same as that of a perfectly competitive outcome. C. smaller than that of a competitive oligopoly. D. None of these statements is true.
The formula to compute the spending multiplier is:
A. 1 / (MPC + MPS). B. 1 / (1 ? MPC). C. 1 / (1 ? MPS). D. 1 / (C + I).