To close a recessionary gap, the government can:
a. employ an expansionary fiscal policy that will shift the aggregate demand curve to the right.
b. employ a contractionary fiscal policy that will shift the aggregate demand curve to the right.
c. employ a contractionary fiscal policy that will shift the aggregate demand curve to the left.
d. employ an expansionary fiscal policy that will shift the aggregate demand curve to the left.
a
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________ are a form of regional integration where member countries lower internal trade barriers but maintain existing barriers against nonmembers
A) Customs unions B) Free trade areas C) Reciprocal trade agreements D) None of the above.
The supply curve of books (which are produced using paper made from trees) will shift to the left in response to: a. a decline in college tuition
b. a sharp increase in the demand for and construction of wood-frame homes. c. an increase in the supply of lumberjacks. d. an end to government regulations that limit timber harvesting in national forests.
Answer the following questions true (T) or false (F)
1. College education tends to result in a positive externality because the recipient receives the full benefit of the education. 2. The rising cost of malpractice insurance is one of the leading causes of the increase in health care spending as a percentage of GDP in the United States. 3. "Cost disease" refers to the tendency for low productivity in the service sector to lead to higher costs in those industries.
A new technology is developed for producing solar panels that reduces production costs by 40%. Which of the following is true?
A. For the economy to remain efficient, product produced with this new technology must be equitably distributed to all consumers. B. This new technology will affect efficiency, and will change the equilibrium price and quantity for this industry. C. Firms will continue to operate efficiently as long as no firm adopts this new technology. D. If firms do not adopt this new technology, then the economy will remain in general equilibrium, because firms will not change their price and output decisions.