The marginal cost curve:
a. Usually declines initially as output increases and then rises with further increases in output
b. Is equal to the average variable cost curve
c. Usually rises initially as output increases and declines with further increases in output
d. Is always constant
a
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The debt-to-GDP ratio increases when the primary deficit ________ or when seigniorage ________
A) increases; increases B) increases; decreases C) decreases; increases D) decreases; decreases
The aggregate demand curve shifts when there are changes in:
A. exogenous spending and the Fed's reaction function. B. potential output and exogenous spending. C. exogenous spending and inflation inertia. D. inflation inertia and aggregate supply shocks.
Trade between countries should be
A. encouraged for developed countries but not for developing countries. B. discouraged for developed countries but encouraged for developing countries. C. discouraged for both developed and developing countries. D. encouraged for both developed and developing countries.
If the Fed engages in open market sales in direct response to an increase in the rate of inflation, this is known as
A) direct policy making. B) active policy making. C) passive policy making. D) fiscal policy making.