If an economy were experiencing a high rate of unemployment as the result of insufficient aggregate demand, a Keynesian economist would favor:
A. an increase in taxes coupled with a reduction in government expenditures of equal size.
B. an increase in taxes.
C. a reduction in taxes, without any offsetting reduction in government expenditures.
D. maintenance of a balanced budget.
Answer: C
You might also like to view...
Which of the following items will be included in official U.S. GDP statistics?
A. Robert paying Ted for a haircut in Chicago. B. Money spent to clean up a local toxic waste site in Ohio. C. The dollar value of the annoyance felt by local citizens living near a noisy airport in Georgia. D. Revenue generated by illegal marijuana growers in Oregon. E. Revenue generated by legal medical marijuana sales in California. F. Emily and Rhonda trading an hour of dance lessons for a haircut in Dallas.
The price elasticity of demand for a good tends
A) not to vary over time because people adjust to changed circumstances. B) to be greater over the long run than over a short period of time. C) to be less over the long run than over a short period of time. D) to rise when the demand increases. E) toward unity in the long run.
Utilitarianism is inconsistent with _____
a. the social welfare function b. cost-benefit analysis c. the Pareto criteria d. slavery
Government provides secondary education because of its private good aspects.
Answer the following statement true (T) or false (F)