Supply-side economics focuses on how fiscal policy might be used to
A. increase consumption.
B. increase aggregate supply.
C. increase aggregate demand to the full-employment level of real GDP.
D. align aggregate demand and aggregate supply.
Answer: B
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As the economy enters a strong expansion in which real GDP increases, which of the following occurs?
A) The demand for money decreases and there is a movement upward along the demand for money curve. B) The demand for money increases and there is a movement downward along the demand for money curve. C) The demand for money curve shifts rightward. D) The nominal interest rate falls as the demand for money curve shifts leftward. E) The demand for money curve shifts leftward.
Happy Bagels sells its bagels for $6 each and the firm has a constant marginal cost of $4 per bagel, which is equal to its (constant) average total cost. If Happy Bagels does not sell a bagel the day it is produced, the bagel is sold as day-old for $2. If Happy Bagels is currently holding 50 bagels in inventory and the probability that Happy Bagels will sell 50 bagels or more is 0.60, which of
the following statements is true? A) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to increase its inventory. B) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to decrease its inventory by exactly one -half. C) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to decrease its inventory. D) Happy Bagels is holding the profit-maximizing, optimal level of inventory.
An economy suffering from high inflation despite low economic growth and high unemployment is experiencing:
A. stagflation. B. an economic boom. C. an economic downturn. D. hyperinflation.
In 1964, President Johnson improved the economy by passing the ______.
a. Reagan tax cuts b. Kennedy tax cuts c. American Recovery and Reinvestment Act d. Supply-Side Laffer Curve