The amount of time it takes for fiscal policy to have an impact on the economy creates:
A. a direction lag.
B. an implementation lag.
C. an information lag.
D. a formulation lag.
Answer: B
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Changes in which of the following shift the short-run Phillips curve?
i. changes in the natural unemployment rate ii. changes in the expected inflation rate iii. changes in the inflation rate A) i only B) ii only C) iii only D) i and ii E) i, ii, and iii
Economists caution that conventional statistics used to estimate the extent of poverty in the United States fail to account for benefits people receive that, if considered, would reduce the amount of poverty
Which of the following is an example of these benefits? A) The federal minimum wage forces employers to pay workers with low skills an efficiency wage. B) Individuals with low incomes receive non-cash benefits such as free school lunches and food stamps. C) Individuals can use tax credits and the personal exemption to reduce their taxable incomes. This reduces what they owe the government and increases their disposable incomes. D) The federal income tax system is progressive. As a result, the poor have higher after-tax incomes than they would have if the income tax system was proportional or regressive.
Which of the following is most likely to be overconsumed?
A. Free water B. Tap water C. Sparkling water D. Bottled water
The value of the balanced-budget multiplier is
A. 1. B. greater than 1. C. greater than 0 but less than 1. D. 0.