If the Federal Reserve takes no countervailing actions, an expansionary fiscal policy will increase the deficit, increase GDP, increase prices, and drive up interest rates
a. True
b. False
Indicate whether the statement is true or false
True
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Both a perfectly competitive firm and a monopolist find that:
A. price is less than marginal revenue. B. it is best to expand production until the benefit and the cost of the last unit produced are equal. C. they can sell as many units of output as they want at the market price. D. price and marginal revenue are the same.
Consider a supply curve of the form: Q = c + dP. If d equals zero, then supply is:
A) completely inelastic. B) inelastic, but not completely inelastic. C) elastic, but not infinitely elastic. D) infinitely elastic
In the macroeconomy, demand-side shifts change:
A. only the price level in the long run, while output eventually returns to its long-run potential level. B. only the output level in the long run, while prices eventually return to their long-run potential levels. C. aggregate demand only, which eventually shifts back in the long run. D. aggregate demand only, which is why the price level remains unaffected in the long run.
Which of the following statements is true for the average individual investor interested in stocks?
a. Trying to pick the stocks that will gain a great deal in the future is a risky and unlikely way to become rich. b. The majority of individual financial investors outguess the market better than professionals. c. Stocks are both low risk and low return but have high liquidity. d. Investing in stocks, bonds, or gold will (on average) provide about the same rate of return in a fiscal year.