Suppose there is a reduction in expected future taxes. This will cause which of the following to occur?
A) the IS curve to shift left in the current period
B) the IS curve to shift right in the current period
C) the LM curve to shift up in the current period
D) the LM curve to shift down in the current period
B
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A large farming operation which uses a potent fertilizer is located up river from a trout farmer. If property rights of the river exist and transactions costs are low, the amount of pollution will be ________
A) efficient only if the trout farmer owns the river B) inefficient if the farming operation owns the river C) efficient if either the farming operation or the trout farmer own the river D) always inefficient
Figure 2-3
Which point in is not possible for this society to produce?
a.
A
b.
B
c.
C
d.
D
e.
E
In real terms, the cost of government spending is measured by
A. Combining the private sector output with the public sector output sacrificed when the government employs scarce resources. B. The private sector output sacrificed when the government employs scarce resources. C. Subtracting private sector output from the public sector output sacrificed when the government employs scarce resources. D. The public sector output sacrificed when the government employs scarce resources.
When unemployment is below the natural rate,
A. frictional unemployment increases. B. inflation slows. C. structural unemployment decreases. D. the inflation rate increases.