An example of nondiscretionary fiscal policy would be
A. a federal jobs program adopted to stimulate consumption.
B. a tax cut adopted to stimulate consumption.
C. an interest rate cut implemented to stimulate consumption.
D. the operation of the welfare state.
Answer: D
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The price in a contestable market is similar to that in a perfectly competitive market because
A) there are barriers to entry. B) there are no barriers to entry. C) there are many firms in the market. D) the firm can earn an economic profit in the long run.
If the tax multiplier is -1.5 and a $200 billion tax increase is implemented, what is the change in GDP, holding everything else constant? (Assume the price level stays constant.)
A) a $133.33 billion increase in GDP B) a $133.33 billion decrease in GDP C) a $30 billion increase in GDP D) a $300 billion decrease in GDP E) a $300 billion increase in GDP
Among the distinguishing characteristics of different types of markets are
a. the number of firms in an industry. b. the presence or absence of product differentiation. c. the ability of any or all firms in an industry to influence market price. d. All of these.
A graph that shows all the equally preferred combinations of two goods is called a(n)
a. demand curve b. supply curve c. consumer surplus curve d. equalization curve e. indifference curve