The Save More Tomorrow (SMarT) program is an example of a:
A. strong commitment device that was successful.
B. weak commitment device that was unsuccessful.
C. strong commitment device that was unsuccessful.
D. weak commitment device that was successful.
Answer: D
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Suppose the government imposes a small carbon tax on automakers. But the price of gasoline has doubled due to a Middle East crisis which has reduced oil production
In the market for autos, these changes mean that supply and demand have both changed with the effect on the demand larger than the effect on the supply. The result is that the price of autos will ________ and the number of autos sold will ________. A) rise; perhaps change but we can't say if it increases, decreases, or stays the same B) rise; increase C) rise; decrease D) fall; perhaps change but we can't say if it increases, decreases, or stays the same E) fall; decrease
If an increase in expected inflation equally raises the nominal interest rate, the expected real interest rate ________ and thus investment demand ________
A) rises, increases B) rises, decreases C) is unchanged, is unchanged D) falls, increases E) falls, decreases
The tax multiplier is equal to the spending multiplier
a. True b. False Indicate whether the statement is true or false
If the Canadian nominal exchange rate does not change, but prices rise faster abroad than in Canada, then the Canadian real exchange rate
a. does not change. b. rises. c. declines. d. None of the above is necessarily correct.