Keynesians believe that the two basic cures for a recession are _____ and _____.
Fill in the blank(s) with the appropriate word(s).
massive government spending; large tax cuts
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The expected effects of an increased budget deficit are
A. higher real interest rates. B. exchange rate depreciation. C. lower inflation. D. All of these responses are correct.
Matt has $2000 saved for a trip at Spring Break. Over Christmas break he decides to spend $400 of it on gifts instead of putting the gifts on his credit card, thus avoiding interest charges. He gradually replaces it in his savings account over the next two months. An economist would say this behavior is:
A. rational. B. not observable. C. utility minimizing. D. irrational.
NIPA benchmark revisions are those that
A. are the final revision of the data. B. incorporate changes in seasonal factors. C. affect data back in time, sometimes as long ago as 1947. D. use income-tax information.
Do firms really seek to maximize profits?