A White House proposal to lower business taxes by increasing tax deductions is an example of:
A. expansionary fiscal policy.
B. contractionary fiscal policy.
C. automatic stabilization.
D. progressive taxation.
Answer: A
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If a monopolistically competitive firm's demand curve is shifting left, it will stop shifting when:
A. firms are positive but not large economic profit. B. the firm is earning negative economic profit. C. the firm is earning zero economic profit. D. price falls to marginal cost.
A budget deficit will be most inflationary if the aggregate
A. demand curve is very steep. B. demand curve is very flat. C. supply curve is very flat. D. supply curve is very steep.
Which of the following is included in the M2 definition of the money supply?
A. Cash and currency B. Checkable deposits C. Money market deposit accounts D. Money market mutual funds E. All of these responses are correct.
If a country increased the production of its capital goods, then
A. the more unemployed resources there will be in the future. B. the more consumption of goods we can have today. C. the more unemployed resources there are today. D. the less consumption we can have today, but we will have more in the future.