According to the Keynesian view, if policy makers thought the economy was about to enter an inflationary boom, which of the following would be most appropriate?
a. a tax increase
b. a planned increase in the budget deficit
c. an increase government expenditures
d. a tax decrease
A
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Refer to Table 4-3. The table above lists the marginal cost of cowboy hats by The Waco Kid, a firm that specializes in producing western wear. If the market price of cowboy hats is $50, how many hats will be produced?
A) 0 B) 1 C) 2 D) 4
If a profit-maximizing firm’s fixed cost of producing widgets falls,
A. its total cost curve is unaffected. B. its marginal cost curve shifts down. C. the firm will produce more widgets. D. the firm’s average profit per widget produced rises.
Which of the following is a FALSE statement concerning purchasing power parity?
A) Purchasing power parity states that dollars will tend to exchange for pounds at a rate that maintains a constant purchasing power of a given quantity of a currency. B) It is rare to see deviations from the purchasing power parity value of currencies. C) Over the long run, purchasing power parity exerts influence over exchange rates. D) An overvalued dollar buys more in Britain than it does in the United States.
Using the demand schedule in the above table, if the firm's marginal cost is constant at $3.00, output for a perfectly price discriminating monopolist is
A) 2 units. B) 3 units. C) 4 units. D) 5 units.