The degree of government involvement in the economy is greatest in
a. a command economy.
b. a mixed economy
c. a market economy.
d. a traditional economy.
a
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Figure 16-3
Figure 16-3 shows the impact of deficit spending and the corresponding economic expansion on the demand curve for money. If the Federal Reserve does not want interest rates to rise, it will
a.
shift the money supply curve to the right by monetizing the deficit.
b.
shift the money supply curve to the left by open market sales of government securities.
c.
maintain the current targets for both M1 and M2 money stocks.
d.
engage in contractionary monetary policy, such as increases in the discount rate.
Entry leads to higher prices and profits in an industry.
Answer the following statement true (T) or false (F)
A shift from S1 to S2 reflects the change that happens when a negative externality is taken into account. A shift from D1 to D2 reflects the change that happens when a positive externality is taken into account.Refer to above figures. Prior to the shift of the curves, which panel and which curve involve the existence of negative externality?
A. Panel 1 and S1 B. Panel 1 and S2 C. Panel 2 and D1 D. Panel 2 and D2
The balance of trade identity says the current account is equal to ________.
A. the reserve account B. 100 C. zero D. the sum of the capital account and the financial account