The time lags, which must be either reduced or known with some precision if fiscal policy is to be an effective stabilizing technique, are the lags between
A) the beginning of a cyclical movement and its recognition.
B) the decision that compensatory action should be taken and the enactment of tax or expenditure changes.
C) the increase or decrease in net government receipts and their final effects on total spending.
D) all of the above, because a significant miscalculation with respect to any of these lags could increase aggregate instability.
D
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The Industrial Revolution
A) marked the beginning of significant economic growth in the world. B) produced goods exclusively using human or animal power. C) had no impact on standards of living in the world. D) started in France around the year 1750.
Which of the following was true of the United States before 1970? a. The government was not responsible for promoting employment, output, and purchasing power. b. Most macroeconomic instability was caused by changes in international oil prices
c. Most macroeconomic instability was caused by shifts of aggregate demand. d. Most macroeconomic instability was caused by the depreciation of the dollar. e. The government was responsible for using monetary policy to correct a depression.
A company may borrow money from
a. banks. b. insurance companies. c. other firms. d. All of the above are correct.
Which of the following would cause an upward shift in the consumption function?
A. A stock market crash B. An increase in the price level C. A decrease in disposable income D. A decrease in the price level