Suppose policy makers pass a budget that reduces the budget deficit. A deficit reduction package such as this has a greater chance of increasing current output when
A) the policy is front-loaded.
B) financial markets believe that taxes will not increase in the future.
C) financial markets believe the Fed will lower interest rates in the future.
D) all of the above
E) none of the above
C
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Consider the same monopoly situation as in the previous question. The firm's profit will be
a. 1,760 b. 1,660 c. 2,264 d. 6,728
If one cigarette company raises its prices and the next day all the other companies in the industry raise their prices by the same amount, this industry would be using _________ to set prices.
Fill in the blank(s) with the appropriate word(s).
Monopolistically competitive firms must produce where there is an optimal allocation of resources because the firms do not present significant barriers to entry to potential competitors.
Answer the following statement true (T) or false (F)
The largest of the regional Federal Reserve Banks is located in:
A. Kansas City. B. New York City. C. San Francisco since it serves almost one-third of the country. D. Washington D.C.