The national debt increased by nearly $2 trillion in the 1980s because of all of the following except
A. Defense spending.
B. Recessions.
C. Tax cuts.
D. College financing.
Answer: D
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If the price of textbooks increases by one percent and the quantity demanded falls by one-half percent, then demand for textbooks is:
A. negative. B. inelastic. C. unit elastic. D. elastic.
Talking about alternatives is the first step in a process that helps us make better choices about how we use our resources
Indicate whether the statement is true or false
What does the demand for labor depend on, directly or indirectly?
(a) The wage rate (b) Productivity of labor (c) Demand for the goods and services produced by the labor (d) All of the above
Suppose the economy is initially in long-run and short-run equilibrium. If the Fed decides to pursue a contractionary monetary policy, we will see
A) bond prices fall, interest rates fall, aggregate demand remains unchanged as consumption spending decreases, but investment spending increases. GDP remains constant in both the short run and the long run, but the price level falls in both. B) bond prices fall, interest rates rise, aggregate demand falls as investment and consumption spending decrease, and real GDP and the price level decreasing in the short-run, but only the price level decreasing in the long run. C) bond prices fall, interest rates rise, aggregate demand falls as investment spending decreases and consumption spending remains unchanged, and real GDP and the price level decrease in the short run, but only the price level falls in the short run. D) interest rates rise but no change in bond prices. Aggregate demand falls as consumption spending and investment spending decrease, and the price level and real GDP fall in both the short run and the long run.