In formulating fiscal policy it is necessary to specify the amount of the desired AD shift.
Answer the following statement true (T) or false (F)
True
The essence of fiscal policy entails deliberate shifting of the aggregate demand curve. The steps required to formulate fiscal policy are straightforward: (1) specify the amount of the desired AD shift (excess AD or AD shortfall) and (2) select the policy tools needed to induce the desired shift.
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A. increase interest rate B. increase taxation rate C. provide incentives to invest D. provide incentives to save
Voluntary trade promotes economic progress because
A) it discourages trade based on the comparative advantage of suppliers. B) This is a trick question; voluntary exchange does not promote economic progress. C) it moves goods, services and resources from people who value them less to individuals who value them more. D) it discourages businesses from seeking lower per-unit costs through adoption of mass production methods.
The M2 measure of money is suggested by the ________ approach to measuring money.
A. liquidity B. transactions C. speculative D. investment
The ________ the utilities from each possible outcome of a situation weighted by the probability of that outcome is called expected utility.
A. change in B. sum of C. product of D. difference in