Automatic stabilizers combine changes in discretionary fiscal policy with changes in government spending and taxes influenced by the business cycle in order to stabilize the economy
a. True
b. False
Indicate whether the statement is true or false
False
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Demand shows the ________relationship between __________and ________________.
a. direct; price; quantity b. inverse; price; quantity c. inverse; supply; quantity d. direct; supply; quantity
The simple circular flow model shows that workers, entrepreneurs, and the owners of land and capital offer their services through:
a. Employment agencies b. Product markets c. Resource markets d. Business firms
Nominal GDP is the
A. Value of final output produced, measured in current prices. B. Value of final output produced, adjusted for changing prices. C. Price index that refers to all goods and services included in GDP. D. Value of final output produced using American-owned factors of production.
Which of the following best describes the cause-effect chain of a restrictive monetary policy?
A. A decrease in the money supply will lower the interest rate, increase investment spending, and increase aggregate demand and GDP. B. A decrease in the money supply will raise the interest rate, decrease investment spending, and decrease aggregate demand and GDP. C. An increase in the money supply will raise the interest rate, decrease investment spending, and decrease aggregate demand and GDP. D. An increase in the money supply will lower the interest rate, decrease investment spending, and increase aggregate demand and GDP.