The stimulus package of 2009 had the effect of
A. reducing the primary government deficit.
B. giving new foreign aid to help less developed countries.
C. causing higher rates of inflation to occur.
D. significantly raising the debt to GDP ratio.
Answer: D
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Health insurance markets have a problem with insuring people who are "poor health risks" while many people who are "good health risks" do not buy insurance. This problem is an example of
A) market signaling. B) moral hazard. C) adverse selection. D) asymmetric information.
If bargaining is costless, the assignment of property rights for an externality:
a. has no impact on the possibility of an efficient outcome and no distributional impact. b. has no impact on the possibility of an efficient outcome but does have a distributional impact. c. does have an impact on the possibility of an efficient outcome but has no distributional impact. d. does have an impact on the possibility of an efficient outcome and does have a distributional impact.
Figure 17-13
In , if the world price of a baseball is $3 and a tariff of $1 per baseball is imposed in the United States, which area represents the United States' net loss as a result of the tariff?
a.
a + b + c + e
b.
b + c + e
c.
b + c
d.
c + e
e.
b + f
How does the price range affect the elasticity of demand for a product?
(A) Price range has little or no effect on elasticity of demand for a good. (B) Demand for a good can be elastic at a low price but inelastic at a high price. (C) Demand for all goods is elastic if the price is low enough. (D) Demand for a good can be inelastic at a low price, but elastic at a high price.