Contractionary fiscal policy that reduces the budget deficit may:
A. reduce business investment by increasing interest rates.
B. increase business investment by increasing interest rates.
C. reduce business investment by reducing interest rates.
D. increase business investment by reducing interest rates.
Answer: D
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The main function of the Federal Reserve System is to
A. clear checks from member banks. B. set reserve requirements of banks. C. control the money supply. D. serve as the fiscal agent for the federal government.
You and I both have homothetic tastes. When the price of peaches goes up, you buy more strawberries and I buy fewer. Which of the following must be true.
A. Peaches are more substitutable with strawberries for me than they are for you. B. Peaches are more substitutable with strawberries for you than they are for me. C. Strawberries are normal goods for you and inferior goods for me. D. Strawberries are normal goods for me and inferior goods for you. E. Both (a) and (c). F. Both (b) and (c). G. Both (a) and (d) H. Both (b) and (d)
A study conducted by a research firm revealed that RiteCure Health Insurance charges higher premiums than most of its rivals. The study also revealed that unlike its rivals, 60% of RiteCure's customers have chronic illnesses
a) What is the link between these two findings? b) What is likely to happen if the premium continues to rise?
Prior to World War II most consumers in the United States:
A. paid for catastrophic illness out of their own pockets but owned medical insurance for routine medical care. B. had no medical insurance of any type. C. owned medical insurance for catastrophic illness but paid for routine medical care out of their own pockets. D. owned medical insurance covering both catastrophic illness and routine medical care.