An austerity policy is
A) an increase in the money supply.
B) an expenditure reduction and expenditure switching policy.
C) an expansionary fiscal policy accompanied by decreases in taxes, increases in expenditures, or both.
D) an exchange rate switching policy from a fixed to a flexible exchange rate system.
E) None of the above.
B
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When residents surrounding an airport complain about noise from aircraft landings and takeoffs, the relevant economic analysis is that of
A. externalities. B. equality-efficiency trade-off. C. comparative advantage. D. the cost decrease of the service sector. E. the cost disease of personal services.
Termination
What will be an ideal response?
At the end of 2012, the government had a debt of about $11.3 trillion. If during 2013 real GDP rose 2% and inflation was 2.2%, what is the largest deficit the government could have run without raising the debt-to-GDP ratio?
a. about $226.0 billion b. about $248.6 billion c. about $474.6 billion d. about $561.8 billion
Recent research regarding increases in the Federal minimum wage shows that
A. unemployment is only slightly affected. B. the minimum wage has many benefits. C. it improves labor productivity. D. the unemployment rate rises.