The self-interest model of government:
a. suggests that government officials are selfish.
b. explains why there are limits on government taxation and spending.
c. shows who some government projects take place even if the cost exceeds the benefits.
d. All of the above.
Answer: b. explains why there are limits on government taxation and spending.
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If the real interest rate falls, people decide to ________ because the opportunity cost of ________
A) decrease their consumption expenditure; consumption has decreased B) increase their consumption expenditure; consumption has decreased C) increase their consumption expenditure; saving has decreased D) save more; saving has decreased E) None of the above answers is correct.
Write out the expression for the Taylor rule. Use the Taylor rule to explain how a decline in real GDP below potential GDP will affect the Federal Reserve's target for the federal funds rate
What will be an ideal response?
The flatter the slope of the supply curve the lower will be the price elasticity of supply
Indicate whether the statement is true or false
Economic growth can best be portrayed as a:
A. leftward shift of the production possibilities curve. B. movement from a point near the vertical axis to a point near the horizontal axis on the production possibilities curve. C. movement from a point inside to a point outside of the production possibilities curve. D. rightward shift of the production possibilities curve.