The marginal propensity to consume measures the average amount of wealth that a consumer spends in a given period of time
Indicate whether the statement is true or false
FALSE
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Fiscal policy is typically
A. difficult to implement quickly. B. extremely flexible, because most government spending is discretionary. C. hard to implement despite the fact that there are not usually implementation problems. D. extremely flexible provided policy lags are short.
In Figure 4-6 above, suppose we are initially at point 2. A reduction in government spending causes income to change by ________ and the interest rate to change by ________ than would be the case in the Chapter 3 model
A) more, more B) more, less C) less, more D) less, less
The following is NOT an example of a potential monitoring solution to moral hazard
a. blocking social network sites on company computers b. closed circuit TVs throughout a warehouse c. requiring a kitchen remodeling contractor to be 'bonded' d. listening in on call center conversations
Scott makes his rent payment on time every month, but half of the time his checks bounce. Scott's landlord wastes several days dealing with a great deal of paperwork to get the funds. The landlord tells Scott that he will accept a check only if Scott's bank guarantees that the funds have been set aside out of Scott's account. This type of check is known as a:
a. cashier's check. b. postdated check. c. certified check. d. teller's check