Ricardian Equivalence theory is based on the view that ________
A) the impact of a tax cut is felt primarily on domestic consumption spending
B) households tend to take future events into account when engaging in economic decision-making
C) the price of a commodity is negatively related to the quantity of that good demanded
D) a trade-off exists between the use of monetary and fiscal policy in influencing the level of income
B
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If a firm has excess capacity, it means
A) that the firm's long-run average cost of producing a given quantity exceeds its short-run cost of producing that same quantity. B) that the firm's quantity supplied exceeds its quantity demanded. C) that the firm expends too much of its resources on advertising its product without seeing an appreciable increase in sales. D) that the firm is not producing its minimum efficient scale of output.
How is the sacrifice ratio measured? How big is the sacrifice ratio in the United States? In other countries? What problems are there in measuring the sacrifice ratio?
What will be an ideal response?
Assume that steak and potatoes are complements. When the price of steak goes up, the demand curve for potatoes:
A) shifts to the left. B) shifts to the right. C) remains constant. D) shifts to the right initially and then returns to its original position.
If the dollar appreciates, it can be said that
a. foreigners respect the United States more. b. it increases in value within the United States. c. other currencies depreciate. d. it takes more dollars to buy foreign currencies.