A government spending and taxation policy to create full employment without inflation is known as
a. closing an inflationary gap
b. fiscal policy
c. closing a recessionary gap
d. a balanced budget
e. a balanced budget multiplier
B
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Which of the following would not shift the production possibilities frontier?
a. an increase in worker training b. a war that destroyed many buildings c. a technological improvement that improved fuel efficiency in cars d. a decrease in the size of the labor force e. a change to a more inefficient production process
Fast food is believed to be an inferior good. This means that
A. the quantity of fast food supplied decreases as income increases. B. the quantity of fast food consumed will always be high. C. the income elasticity of demand for fast food is positive. D. the quantity of fast food consumed decreases as income increases.
If the moral hazard problem in automobile driving were to be eliminated, the marginal cost of driving would be
A) lowered enough to pull the amount of driving back down to the efficient level. B) lowered enough to raise the amount of driving back up to the efficient level. C) raised enough to pull the amount of driving back down to the efficient level. D) raised enough to raise the amount of driving back up to the efficient level. E) lowered back down to the efficient level, relieving the stress on market forces.
It is possible for the dollar to appreciate against the Japanese yen while depreciating against the British pound
a. True b. False Indicate whether the statement is true or false