In both the 1970s and the 1990s, extreme economic events caused unemployment to move in the same direction as inflation.
Answer the following statement true (T) or false (F)
True
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The calculation of the final goods and services sold in an economy would NOT include
A) the purchase of a lawnmower by a household. B) General Motors' purchases of tires for new automobiles. C) Ford Motor Company's purchase of a new industrial robot to be used to produce cars. D) the purchase of a service by a household.
If a tax is progressive, the average tax rate
A. remains the same as income rises. B. rises as income rises. C. falls as income rises. D. falls with passage of time.
Expenditure switching policies are best used on their own
Indicate whether the statement is true or false
If the government purchases multiplier equals 2, and real GDP is $14 trillion with potential real GDP $14.5 trillion, then government purchases would need to increase by ________ to restore the economy to potential real GDP
A) $7.25 trillion B) $1 trillion C) $500 billion D) $250 billion