Under a balanced budget policy, a sharp decline in GDP will cause
A. no serious budget changes.
B. a tax cut or an increase in expenditures.
C. a tax increase or expenditure cut.
D. tax receipts to exceed government expenditures.
Answer: C
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Which of the following is not prohibited by the Clayton Act, even if it reduces competition?
a. merger accomplished through the acquisition of another firm's stock b. merger accomplished through the acquisition of another firm's assets c. price discrimination that cannot be justified on the basis of cost differences d. exclusive dealing contracts e. interlocking directorates
Given a national income of $800 billion, an MPC of 0.8, and autonomous consumption of $60 billion, what is the level of consumption spending?
a. $640 billion b. $700 billion c. $760 billion d. $800 billion e. $860 billion
In Figure 9.8, if full-employment income is produced at $400 billion, which of the following can alleviate a recession?
A. An increase in interest rates. B. An increase in taxes. C. An increase in government spending. D. An increase in saving.
Which of the following is NOT a true statement about industrial policies?
A) Industrial policies can lead to the development of successful industries. B) Not all industrial policies are successful. C) Not all industrial policies are the best use of a nation's resources. D) Most industrial policies are legal under WTO rules.