If the MPC = 0.80, the cumulative decrease in total spending resulting from an initial $150 recessionary gap would be
A. $150.
B. $187.5.
C. $750.
D. $500.
Answer: C
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Using the DD-AA framework, which one of the following statements is the MOST accurate?
A) Only monetary policy can bring the economy to full employment. B) Only fiscal policy can bring the economy to full employment. C) Only both monetary and fiscal policies can bring the economy to full employment. D) Both policies are capable of bringing the economy to full employment and low inflation. E) Monetary policy by itself or fiscal policy by itself can bring the economy to full employment.
Which of the following is a public good created by the market?
a. Broadcast radio b. Tornado sirens c. Street lights d. Cable television
Suppose that reducing inflation by 2 percentage points would cost a country 5 percent of its annual output. This country's sacrifice ratio is
a. 0.4. b. 1.5. c. 2.5. d. 5.0.
Which of the following statements is true?
A. A mineral rights auction is not the same as a common-value auction. B. An auctioneer is always indifferent between different kinds of auctions. C. An English auction always yields lower expected revenues than a second-price, sealed-bid auction. D. The Dutch and first-price, sealed-bid auctions are strategically equivalent.