Countercyclical policy was relatively uncomplicated for Keynesian economists. It simply required that
a. during recession, government runs budget surpluses and the Fed expands the money supply, while during prosperity, government runs budget deficits and the Fedcontracts the money supply
b. during recession, government runs budget surpluses and the Fed contracts the money supply, while during prosperity, government runs budget deficits and the Fedexpands the money supply.
c. during recession, government runs budget deficits and the Fed expands the money supply, while during prosperity, government runs budget surpluses and the Fedcontracts the money supply.
d. during recession, government runs budget deficits and the Fed contracts the money supply, while during prosperity, government runs budget surpluses and the Fedexpands the money supply.
e. during recession, government runs budget deficits and during prosperity, government runs budget surpluses. The Fed should not get involved with expanding orcontracting the money supply according to Keynesians.
C
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The opportunity cost of any action is
A) all the possible alternatives given up. B) the highest-valued alternative given up. C) the benefit from the action minus the cost of the action. D) the dollars the action cost.
Refer to Table 4-8. If a minimum wage of $10.50 an hour is mandated, what is the quantity of labor demanded?
A) 400,000 B) 370,000 C) 340,000 D) 60,000
The kinked demand curve depicts
A. cut-throat competition. B. cartels. C. collusive oligopoly. D. price leadership.
Answer the following questions true (T) or false (F)
1. Autarky is a situation where one country does not trade with other countries. 2. The ratio at which a country can trade its exports for imports from other countries is called comparative advantage. 3. A tariff is a numerical limit on the quantity of a good that can be imported.