A rightward shift in the aggregate demand curve is most likely to result in
A. deflation.
B. recession.
C. inflation.
D. decrease in employment.
Answer: C
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The ability of the federal government to regulate the distribution of income among families and individuals is
A) enormous, as shown by the redistribution that has occurred from the rich to the poor since World War II. B) largely limited to what can be accomplished through revisions in the rules of the game. C) unlimited because government is sovereign. D) virtually unlimited because few people would be willing to emigrate merely in order to escape taxation.
Which one of the following is not one of the monetary control instruments available to a Central Bank?
(a) Moral suasion (or advice); (b) Reserve requirements; (c) Discount rate; (d) Tax rates.
A negative externality or spillover cost occurs when:
A. firms fail to achieve allocative efficiency. B. firms fail to achieve productive efficiency. C. the price of the good exceeds the marginal cost of producing it. D. the total cost of producing a good exceeds the costs borne by the producer.
Gross domestic product understates the total production of final goods and services because of the omission of
A) exports. B) inflation. C) intermediate goods. D) household production.