Which of the following statements is correct?
a. A decrease of government spending is most effective in the flat part of the SRAS curve.
b. An increase in interest rates is most effective in the flat part of the SRAS curve.
c. An increase in the money supply is most effective in the steep part of the SRAS curve.
d. A tax increase is most effective in the steep part of the SRAS curve.
d. A tax increase is most effective in the steep part of the SRAS curve.
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The general form of the per-person production function used in Chapter 10 is
A) (Y/N) = A - f(N/K). B) (Y/N) = A + f(N/K). C) (Y/N) = A/f(K/N). D) (Y/N) = Af(K/N).
Over the past century, the main factor responsible for rising living standards in the United States has been productivity growth.
Answer the following statement true (T) or false (F)
If we as individuals would continue to spend more than we made, we would sooner or later have to pay up or go bankrupt. Our government is in the same position or will be unless we get serious about our liabilities and reduce expenditures enough to reduce the deficits or increase revenues enough to pay our bills and have some left over to pay the old bills. Evaluate this statement.
What will be an ideal response?
What impact will a negative demand shock have on the main measures of economic performance?
A. Real GDP will increase, inflation will increase, and unemployment will decrease B. Real GDP will decrease, inflation will decrease, and unemployment will increase C. Real GDP will decrease, inflation will increase, and unemployment will increase D. Real GDP will increase, inflation will decrease, and unemployment will decrease