An expansionary fiscal policy
I. includes an increase in government spending.
II. includes tax cuts.
III. increases a government budget deficit or reduces a government budget surplus.
A) I, II, and III
B) I and II only
C) I and III only
D) II and III only
Ans: A) I, II, and III
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In economics, normative statements are about
A) the way things ought to be. B) the way things are. C) marginal benefits, not marginal costs. D) marginal costs, not marginal benefits.
According to the graph shown, if this economy were an autarky, producers would enjoy area:
This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
A. BCEFG
B. BCDEFG
C. G
D. EFG
In this economic growth and production possibilities curve, economic growth is represented by the ______.
a. y-axis
b. x-axis
c. area between points A and E
d. area between the two curves
Using Figure 1 above, if the aggregate demand curve shifts from AD1 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y2. C. P3 and Y1. D. P2 and Y3.