Which of the following would be a contractionary fiscal policy that would help close an expansionary gap?
a. increase in government purchases
b. decrease in taxes
c. decrease in government purchases
d. none of the above are contractionary fiscal policies
c
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Before summer 2008, if you wanted a cell phone in Bhutan, you only had one choice: B-Mobile, owned and operated by the government. Then, this past spring, a privately owned competitor, Tashi, was let in
What do you predict will happen to equilibrium price and quantity in the cell phone market? A) Price will decrease and quantity will increase. B) Price will increase and quantity will decrease. C) Both price and quantity will increase. D) Both price and quantity will decrease.
When marginal cost exceeds marginal revenue,
A. marginal profit < 0. B. the firm should increase output. C. marginal profit + marginal cost > marginal revenue. D. marginal cost < marginal revenue - marginal profit.
A worker who brings both labor and human capital to her job earns
a. both the wage rate for her labor and a share in the employer's profits. b. both the wage rate for her labor and a market rate of return on her skills. c. the going wage rate for her labor, the benefits of her capital accrue to her employer's owners. d. both the going wage rate for her labor and annual bonuses based on the level of profits and her skills.
The marginal productivity principle says that a profit-maximizing firm should
A. hire capital until its marginal product is zero. B. hire labor until another worker costs more to hire than he or she can earn for the firm. C. hire the quantities of capital and of labor at which their marginal products are equal. D. hire capital until its marginal product is negative.